Senate
22 April 1969

26th Parliament · 2nd Session

  1. Senate
  2. 26th Parliament
  3. 1969

The PRESIDENT (Senator the Hon. Sir Alister McMuliin) took the chair at 3 p.m., mid read prayers.

page 917

PETITIONS

Export of Merino Sheep

Senator MCCLELLAND presented from 23 I citizens of New South Wales a petition showing that the decision of the Government to lift the 40-year ban on the export of merino rams will do irreparable harm to the present and future merino wool industry of Australia; that the initial quota of 300 rams will be sufficient to make any future protest worthless; and that the production of fine medium quality merino wool in cheap labour countries will put the Australian merino wool grower and all connected with this industry out of business. The petitioners pray that the Government will cause to be held a referendum of wool growers to determine this issue.

Petition received and read.

Export of Merino Sheep

Senator O’BYRNE presented from 156 citizens of New South Wales a petition showing that the decision of the Government to lift the 40-year ban on the export of merino rams will do irreparable harm to the present and future merino wool industry of Australia; that the initial quota of 300 rams will be sufficient to make any future protest worthless; and that the production of fine medium quality merino wool in cheap labour countries will put the Australian merino wool grower and all connected with this industry out of business. The petitioners pray that the Government will cause to be held a referendum of wool growers to determine this issue.

Petition received.

page 917

QUESTION

CHEMICAL WARFARE

Senator COHEN:
VICTORIA

– I address a question to the Leader of the Government in the Senate in his capacity as Minister representing the Minister for Defence. I refer to answers given by the Minister in the Senate on 16th and 17th April concerning the use of CS gas in Vietnam and in particular his statement that Corporal Bowtell had not been killed by this gas in Vietnam in 1966. Is the Minister aware that on the day after the Minister’s denial a Mr Danny Danaher a former member of the 1 st Battalion Royal Australian Regiment said in Darwin, according to widespread newspaper reports, that he was present in January 1966 at Ben Cat when Corporal Bowtell’s body was dragged out of a tunnel which had been sprayed with CS gas and that he was also present when mouth to mouth resuscitation and heart massage were administered to the corporal but that he had failed .to respond? I ask the Minister: Does not Mr Danahers statement flatly contradict that of the Minister? Will the Government order a full inquiry into Mr Danaher’s allegations and the circumstances of Corporal Bowtell’s death?

Senator ANDERSON:
Minister for Supply · NEW SOUTH WALES · LP

– lt is true that my attention was drawn to a Press statement made by the person to whom the Deputy Leader of the Opposition referred. I was asked to comment and declined to do so. I can understand - I am sure all of us could understand - that a serviceman involved in the emotional circumstances of being with the Corporal at the time of his death, could have thoughts about CS gas. I do not deprecate this. I am sure all of us could recognise that this could happen. However, the facts are that on 13th January 1966 the then Minister for the Army, Dr Forbes, issued a Press statement relating to these circumstances. In it he pointed out that the cause of death was not CS gas, as was stated. This statement was followed by a further statement on 14th January 1966 by the Directorate of Public Relations, Army Headquarters, Canberra, relating to a ministerial report on the death of Corporal Bowtell. The Army, following the Minister’s statement, made a clear statement, about this matter. One can understand that anybody with Corporal Bowtell at the time could draw the conclusion, particularly in view of the emotional circumstances of the time, that CS gas may have been responsible for his death. But the fact is that the then Minister for the Army, and the Army authorities, investigated the matter and issued Press statements saying that CS gas was not the cause of death. With the concurrence of honourable senators I incorporate the two Press statements in Hansard.

page 918

FOR PRESS No. 3860

page 918

CORPORAL’S DEATH CLARIFIED

(Statement by the Minister for the Army, Dr the Hon. A. J. Forbes.)

The death of Corporal Bowtell in Viet Nam was not due to the use of tear gas, the Minister for the Army, Dr A. J. Forbes, said today.

The soldier died in the course of an operation involving the clearance of a complex of Viet Cong tunnels in the Ben Cat area.

Smoke grenades and the subsequent use of high explosive grenades exhaust the limited amount of oxygen in deep tunnels and create fumes in these restricted spaces.

Corpora] Robert Waller Bowtell, 33, married, of Casula, N.S.W., died as a result of these conditions, which under certain circumstances can produce lethal concentrations of carbon monoxide.

Further inquiries are being made as to the exact circumstance but it was emphasised that Corporal Bowtell’s death was not due to tear gas, which could not have lethal effects as used in Viet Nam.

Tear gas is used in this type of operation to avoid needless casualties, especially among women and children. (Lists; Gallery Only)

Further information:

Captain M. F. Taylor (61-2212)

page 918

CANBERRA:

13th January 1966.

page 918

FOR PRESS No. 3863

Directorate of Public Relations, Army Headquarters, CANBERRA, A.C.T.

page 918

MINISTERIAL REPORT - CORPORAL R. W. BOWTELL

A further report on the death of Corporal Bowtell just received by AHQ confirmed that his death was not related to the use of tear gas, the Minister for the Army, Dr A. J. Forbes, said today.

The Minister was commenting on an earlier statement concerning the death of this soldier in the course of an operation involving the clearance of a complex of Viet Cong tunnels by Australian troops in the Ben Cat area of Vietnam.

The report states that Corporal Bowtell, who was leading a team of engineers searching underground tunnels and chambers, discovered a trapdoor leading to a very small lower tunnel.

On entering this tunnel he became wedged In an almost upright position and complained of lack of air.

A shaft was dug immediately, with difficulty because of the confined space, to enable fresh air to be pumped to him and at the same time efforts were made to drag him free.

When the shaft was completed, air was pumped in but Corporal Bowtell fainted and slipped a little, becoming even more firmly wedged.

To enable him to be freed the shaft was extended but Corporal Bowtell was dead when brought to the higher level.

His death was due to lack of oxygen.

Foul air has since been discovered in pockets in other tunnels which have not been subject to tear gas or smoke.

Investigations suggest that foul air fillers down to lower levels through the tunnel complex producing, under certain circumstances, conditions similar to those to which Corporal Bowtell was exposed.

Detailed examination of the problem by engineers and other technical members is being carried out to determine the most effective solution. lt was emphasised that every precaution was being taken to ensure the safety of soldiers involved in this type of operation.

Special equipment, effective in all cases of air pollution, is available in Vietnam and would be used wherever necessary. (Lists: Gallery Only)

Further information:

Captain M. F. Taylor (61-2212) (49-6301)

page 918

CANBERRA:

14th January 1966.

page 918

QUESTION

RAILWAYS

Senator DAVIDSON:
SOUTH AUSTRALIA

– Has the. Minister representing the Minister for Shipping and Transport any progress report or comment to make on the feasibility study being undertaken into the proposed standard gauge railway between Adelaide and Port Pirie in South Australia? Can the Minister say when a decision on the construction of this line is likely to be made?

Senator SCOTT:
Minister for Customs and Excise · WESTERN AUSTRALIA · LP

– 1 know a feasibility study is being made of the proposed railway line mentioned by the honourable senator. I do not know when the results of that study will be available.

Senator Bishop:

– I raise a point of order, Mr President. There is a question on notice relating to this subject and an answer is to be provided today.

The PRESIDENT:

– Order! The point of order is upheld.

page 918

QUESTION

WHEAT

Senator HENDRICKSON:
VICTORIA

– 1 direct a question to the Minister representing the Treasurer. As the Commonwealth Government will do nothing to help make the wool industry profitable, by means of orderly marketing or subsidy, and because of this woolgrowers have transferred to wheat production, thus causing over-production beyond the ability of the Australian Wheal Board to sell, and as the Government entered into the International Grains Arrangement which raised the minimum price so high that the Wheat Board last August lost a sale of up to seventy million bushels to China because China would not pay the higher price when she could buy cheaper wheat elsewhere - that is, from Canada - will the Government consider assisting the wheat industry by purchasing one million tons of wheat, or approximately forty million bushels, and giving it to those countries where great starvation exists? Is it a fact that the Government only raised the minimum price of wheat under the International Grains Arrangement so that the Treasury would not have to provide so much much money to bring the price up to the amount guaranteed under the wheat stabilisation plan?

Senator ANDERSON:
LP

– The honourable senator asks me a series of questions which relate to about four different portfolios. Quite clearly, I would not be competent to answer them all. I suggest that they should go on the notice paper. Then I will have them separated and directed to the various departments concerned - the Department of the Treasury, the Department of Trade and Industry, the Department of External Affairs and the Prime Minister’s Department - and I will see whether I can obtain the necessary answers for the honourable senator.

page 919

QUESTION

RAILWAYS

Senator YOUNG:
SOUTH AUSTRALIA

– Is the Minister representing the Minister for Shipping and Transport aware that in many European countries concrete sleepers are now being used extensively in railway systems? Will the Minister for Shipping and Transport give consideration to using concrete sleepers in the proposed Port Augusta to Whyalla railway and for the proposed rail standardisation in South Australia, as well as for the replacement of sleepers in track maintenance of other Commonwealth railways associated with South Australia?

Senator SCOTT:
LP

– I wish to advise the honourable senator that many European countries are using concrete sleepers in the construction of their railway systems.

Although concrete sleepers provide an improved track and have a superior life to wooden sleepers, we as a Government have to take into consideration the economics of the whole situation. I can inform the honourable senator that at the present time the Commonwealth Railways have almost 10,000 concrete sleepers laid and are carrying out tests as to their suitability or otherwise for the future construction of Commonwealth lines.

page 919

QUESTION

INFLUENZA VACCINE

Senator FITZGERALD:
NEW SOUTH WALES

– Is the Minister representing the Minister for Health aware that children under 5 years and people over 60 years are being prevented from securing Hong Kong flu vaccine by a lack of supplies? ls she aware that asthma sufferers among children are being denied this vaccine while large business establishments are able to secure unlimited supplies for their executives and staff? ls she also aware that the Deputy Medical Secretary of the Australian Medical Association has stated that he is unable to get satisfaction on behalf of Sydney doctors who have issued their patients with prescriptions for the vaccine and has claimed that at present it is difficult to obtain factual information from the Commonwealth Serum Laboratories as to the future of the vaccine? ls it not a fact that supplies on hand are sufficient to fill only a fraction of the prescriptions that chemists are holding for pensioners and other people?

Senator Dame ANNABELLE RANKIN:

– The honourable senator asks a series of questions based mainly on the supply of Hong Kong influenza vaccine. He refers to the point that was made earlier, namely, that certain categories were recommended for priority. They included children under a certain age, aged persons and asthmatics. I will place the points he has made before the Minister for Health. But I think I should refer to the part of his question in which he said that some comment had been made about the future of supplies. I have already answered a question on this subject in this chamber, but I believe that it is important that J repeat that answer. The Minister for Health said in reply to a question:

The Commonwealth Serum Laboratories Commission leads the world in the development of influenza vaccines and has made an enormous effort to meet the unprecedented demand for influenza vaccine this year. Already this year the Laboratories have distributed in Australia approximately four times the average total annual issue of influenza vaccine over the past 10 years and are continuing to manufacture at the rate of 250,000 doses per week.

The Minister said that because of the unprecedented demand from many quarters it was inevitable that in some instances delays would occur in satisfying demand. However, since April 1st the supply position has eased. In reply to a similar question addressed to me last Thursday I said that the Commonwealth Serum Laboratories were continuing to produce a very large amount of serum.

page 920

QUESTION

TARIFF BOARD

Senator SIM:
WESTERN AUSTRALIA

– Can the Minister representing the Minister for Trade and Industry inform me when an appointment is likely to be made to fill the vacant positions on the Tariff Board? Is the delay in making the appointments affecting the Tariff Board’s review of areas of high protection?

Senator ANDERSON:
LP

– 1 ask the honourable senator to put his question on the notice paper. I am aware that there is a vacancy - in fact there may well be two vacancies - on the Tariff Board. I am not aware of the timetable to fill the vacancies. I will seek the information for the honourable senator.

page 920

QUESTION

KOREA

Senator O’BYRNE:
TASMANIA

– I direct my question to the Leader of the Government in the Senate. I preface my question by referring to a statement made in Sydney yesterday by the Prime Minister that Australia and the United States of America will stay together in rough or smooth weather. Can the Minister give the views of the Australian Government on the situation in North Korea where flights by United States aircraft have resumed under strong air and naval cover, a position which could lead to another major United States involvement on the Asian mainland? Is Australia prepared to follow the United States into a full scale resumption of the Korean war? Was the Australian Government, as a former ally of the United States in the Korean war, consulted about current United States strategy in respect of North Korea?

Senator ANDERSON:
LP

– The honourable senator referred to a statement made by the Prime Minister at a magnificent function held yesterday. At the function the Prime Minister made, if T may be permitted to say so, a magnificent speech in which he drew attention to the fact that Australia’s association with the United States of America is not a fair weather alliance. Tt is one in which the rough and the smooth find their places. The honourable senator then directed his attention to the question of what has happened in North Korea. I remind him that Australia’s participation in the military action that took place in North Korea some years ago was undertaken under the aegis of the United Nations. Australian forces represented Australia as a member of the United Nations, in the same way as United States forces represented the United States of America. I think the honourable senator had better place the balance of his question on the notice paper.

page 920

QUESTION

SHIPPING

Senator LILLICO:
TASMANIA

– Can the Minister representing the Minister for Shipping and Transport state the reasons for higher freight costs between Tasmanian and mainland ports in comparison with similar freight costs between ports in other States? .1 ask this question because the higher freight costs appear to be the reason for the exclusion of Tasmania from the flat rate charges for the container service between Australia and the United Kingdom. Is it not of great importance that the disparity between freight rates for shipment, between Tasmania arid mainland ports and rates for shipment between other Australian ports should be completely investigated?

Senator SCOTT:
LP

– I know that shipping freights are vital to Tasmanian producers of goods for export. I know also that as the honourable senator said, freight charges are higher for shipments to and from Tasmania than for similar journeys between other Australian ports. As to the reason for the increases in these costs, I ask the honourable senator to place that part of his question on the notice paper so that I can obtain a reply for him from the Minister.

page 921

QUESTION

DEPARTMENT OF CUSTOMS AND EXCISE

Senator WHEELDON:
WESTERN AUSTRALIA

– I direct my question to the Minister for Customs and Excise. I refer to the Minister’s statement on 21st April that two officers’ of his Department employed at Fremantle were dismissed for accepting bribes. Have the persons who paid the bribes been prosecuted? Have there been instances when junior officers at Fremantle have reported to their superiors that bribes have been offered to them but no action has been taken against the persons offering the bribes, although during the past few weeks action has been taken immediately against junior officers who have been accused by persons arriving from overseas of soliciting or accepting bribes?

Senator SCOTT:
LP

– Before the initial charge was laid and the person concerned was convicted and fined $600, further investigations were made at my instigation and two other members of the Department of Customs and Excise who worked on the wharf at Fremantle were charged. Those cases are at present before the court. T will obtain an answer for the honourable senator in regard to the other part of his question.

page 921

QUESTION

SHIPPING

Senator LAUCKE:
SOUTH AUSTRALIA

– I wish to ask a question of the Minister representing the Minister for Shipping and Transport. As the Whyalla shipyards in South Australia have proved their ability to build ships of the type required for the container shipping trade, will the Government consider building at Whyalla any ships to be added to the Australian National Line?

Senator SCOTT:
LP

– Recently I had the pleasure of visiting the Whyalla shipyards and found under construction one bulk carrier of, I understand. 55,000 tons and another in excess of 20,000 tons for the Broken Hill Pty Co. Ltd. Australia’s shipbuilding industry has progressed rapidly. When I was in Whyalla some years ago 1 found that the largest ship which could be built there was about 20,000 tons. In relation to the other part of the honourable senator’s question, I will take the matter up with the Minister for Shipping and Transport and obtain a reply for him.

page 921

QUESTION

CHEMICAL WARFARE

Senator McMANUS:
VICTORIA

– I desire to ask a question of the Leader of the Government in the Senate. Is it a fact that the reason for the use of CS gas is to make uninhabitable and unusuable positions prepared for attacking Australian soldiers? Does the Minister agree that the average Australian would prefer such positions to be made uninhabitable and unusable rather than be used to assist in killing or wounding Australian soldiers?

Senator ANDERSON:
LP

– Yes, 1 wholeheartedly agree with the honourable senator. I am sure that anybody who puts his mind to the matter will also agree. When I answered a similar question last week I made the point that CS gas is used for civil purposes. It is used for riot dispersals. It is a non-lethal, non-toxic gas. Of course, it is axiomatic that if this non-lethal gas can be used to make areas unusable rather than allow them to be re-occupied by the enemy and used to inflict further casualties on Australian troops, this should be done. I would have thought that a child of any age would understand that proposition and would accept it as sheer logic.

page 921

QUESTION

EDUCATION

Senator LAUGHT:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Education and Science. Is the Minister aware that the Government of South Australia proposes building a teaching hospital in the grounds of the Flinders University by 1974, but that it is anxiously awaiting the decisions of the Australian Universities Commission and the Australian Government on the project? Will the Minister inquire as to when the Government’s decision will be announced?

Senator WRIGHT:
Minister for Works · TASMANIA · LP

– I do not have information immediately available on the matter, but I will gladly accept my colleague’s suggestion to make inquiries and give him up-to-date information.

page 921

QUESTION

DAIRY INDUSTRY

Senator DEVITT:
TASMANIA

– When does the Minister representing the Minister for Primary Industry anticipate that a statement setting out the general terms of the farms amalgamation plan, which is part of the proposal for the rehabilitation of the Australian dairy industry, will be made? ls the Minister in a position to indicate to the Senate the kind of proposals that the Government has in mind to effect the purposes of the scheme, and what will be the States’ responsibilities in the matter?

Senator McKELLAR:
Minister for Repatriation · NEW SOUTH WALES · CP

– I have nothing further to add to the reply that 1 gave last week to a similar question. That reply was to the effect that if complete unanimity could not be achieved by the various States the Minister for Primary Industry was prepared to negotiate with the Stales on a separate basis. I have no further information.

page 922

QUESTION

SHORTS CENTRE

Senator MULVIHILL:
NEW SOUTH WALES

– I direct a question to the Leader of the Government in the Senate. By way of preface I refer to the desire of Lions International to create a sports complex in the western suburbs of Sydney and to the justified fears of residents in the suburbs of Five Dock and Concord, backed up by the Concord Municipal Council, that the site suggested by Lions International would present certain parking difficulties. Since such a sports complex would enable Sydney in the future to emulate Melbourne and Perth in that it could act as host at future Olympic and Commonwealth Games, what is the possibility of such a sports complex being created in the Newington area, along the upper reaches of the Parramatta River, which is at present used as a Commonwealth arsenal?

Senator ANDERSON:
LP

– My understanding is that the Department of the Navy occupies some 640 acres of land at the Newington Armament Depot used for the transport and storage of explosives. The wharf on the Parramatta River and the land within a safety distance radius of 2.100 feet, including road access to the wharf, must be retained by the Commonwealth as this is the only outlet in the port of Sydney for the supply of ammunition by sea to the Services and other Commonwealth authorities. The remaining area is required for the storage of explosives and could be vacated only at a very high cost to the Commonwealth by the construction of storage elsewhere to replace the magazines and stores which would be lost at Newington if the land were alienated for other purposes.

page 922

QUESTION

CHEMICAL WARFARE

Senator CAVANAGH:
SOUTH AUSTRALIA

– 1 ask the Leader of the Government in the Senate whether the Government supports the use of any type of gas in warfare, ls the use of any type of gas in warfare a breach of the Geneva Convention? If the Government supports the use of some types of gas in warfare, what degree of danger to life must the gas contain before it is outside the Government’s sanction?

Senator ANDERSON:
LP

– Again 1 draw the Senate’s attention to the fact that I answered a similar question last week, when i referred to a statement by the then Mr Hasluck as Minister for External Affairs that the use of CS gas was not restricted by the Geneva Convention. I repeat what 1 said in answer to Senator McManus’ question a short time ago. This form of gas is used by civilian authorities all over the world. In fact it is used by the Australian State police forces. It was used in Sydney recently and its use probably had the effect of saving lives. 1 would think everybody would be marching forward to cheer anything that could save lives in a situation of war.

page 922

QUESTION

CHEMICAL WARFARE

Senator BISHOP:

– My question is directed to the Leader of the Government. Can the Minister’s replies to Senator Cohen and Senator Cavanagh be taken to indicate that he has no intention of supporting any further investigations into complaints made by the Deputy Leader of the Opposition in another place in relation to CS gas?

Senator ANDERSON:
LP

– In replying to the honourable senators I gave the answer that had been given at the time by the responsible Minister. I see no good purpose in pursuing the matter further but rather I see a lot of embarrassment and sadness for the family of the corporal who died if the matter is pursued. It has been clearly established that the circumstances of the corporal’s death were not associated with CS gas.

page 923

QUESTION

MILITARY ALLIANCE

Senator WHEELDON:

– Has the Minister representing the Minister for External Affairs seen reports of statements made recently by Ministers of the South African Government calling for a military alliance between South Africa, Australia and certain South American countries? Have any approaches been made to the Australian Government by the South African Government for the purpose of creating such an all’iance?

Senator ANDERSON:
LP

– I have not seen the statements referred to by the honourable senator. I think the proper thing to do would be to put his question on the notice paper.

page 923

QUESTION

VIP AIRCRAFT

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– I ask the Minister representing the Minister for Air a question. Are there any regulations or rules concerning the use of VIP aircraft? If so, will he table them in the Senate?

Senator MCKELLAR:
CP

– During the regime of the late Mr Harold Holt regulations were drawn up regarding the use of VIP aircraft. I understand that they are now being looked at again. I have not yet seen the results of this review, but I shall make inquiries and see what information I can get for the honourable senator.

Fill AIRCRAFT

Senator O’BYRNE:

– Can the Leader of the Government report to the Senate on the statement that the twenty-four Fill swing wing bombers will not be delivered until November of this year or early next year? Can he give any information as to when these machines are likely to arrive in Australia?

Senator ANDERSON:
LP

– I saw the statement to which the honourable senator is obviously referring. 1 have not received any authoritative comment on the subject from the Minister for Defence, but I shall treat the question as being on notice and get a reply for the honourable senator. I would hope to have the reply reasonably soon.

page 923

QUESTION

DEVALUATION OF AUSTRALIAN DOLLAR

Senator MILLINER:
QUEENSLAND

– I direct a question to the Minister representing the Prime Minister. Is the Government satisfied that its decision to refrain from devaluing the Australian dollar was correct? Have subsequent events vindicated such decision? Have any industries affected by the Government’s decision been adequately compensated as a result of the decision not to devalue?

Senator ANDERSON:
LP

– In asking this question the honourable senator is going a little into history. The Government made a decision and I believe that it was a good decision. I believe that it has been vindicated as a good decision. I believe that the assistance given by the Government to primary industry particularly, but also to manufacturing industry, has provided a cushioning against the adverse effects of the devaluation of sterling. I believe that this has vindicated the Government’s decision. As a matter of fact, my answer is yes to all questions asked by the honourable senator.

page 923

QUESTION

SHIPPING FREIGHTS

Senator DEVITT:

– My question, which is addressed to the Minister representing the Minister for Trade and Industry, follows the question asked by Senator Lillico a short while ago on shipping freight rates. Is it a reasonable proposition that because Tasmania is separated from the main overseas container terminals by water, the freight rates should be higher than those for quite remote areas of the continent which are separated from the main container terminals by substantial distances over land? What causes the quite remarkable situation wherein land transport costs are not added but sea transport costs are added to overseas container shipping freight rates?

Senator ANDERSON:
LP

– I believe that this question should be re-directed to the Minister for Shipping and Transport to keep it in continuity with the previous questions. However, if the honourable senator would like me to do so I shall direct this question to the Minister for Trade and Industry for a reply.

page 924

QUESTION

QANTAS AIRWAYS LIMITED

Senator FITZGERALD:

– Is the Leader of the Government in the Senate aware that Qantas Airways Ltd is greatly concerned that in the very near future the President of the United States of America will nominate one of America’s largest airlines to fly to Australia, thereby placing the Australian owned airline at a decided disadvantage? Will the Minister direct this matter to the attention of our Prime Minister so that when he has his next discussions with the President of the United States he will ensure that Australian airlines are not placed at a disadvantage as is the case with every other activity in the fields of trade and commerce? Alternatively, will further moneys be made available to Qantas to allow it to compete on an equal basis with the American airline?

Senator ANDERSON:
LP

– The question has some elements of hypothesis.I really believe that it should be directed to the Minister for Civil Aviation, since he is responsible for matters affecting civil aircraft in Australia, rather than to the Prime Minister. I do not believe that the matter as presented to us at this time would attract the special consideration of the Prime Minister and the President of the United States. Nevertheless I will seek to obtain some further information on the background to the story that the honourable senator has told and perhaps then will direct it to the Prime Minister.

page 924

QUESTION

TELEVISION

Senator BISHOP:

– My question, which is addressed to the Minister representing the Postmaster-General, relates to the depicting of violence in television programmes and my recent questions to her about the reported voluntary action of United States television systems to restrict violence in television programmes. Has the Minister seen some recent proposals by the United States Department of Health which intends to set up a specialist committee to study violence on television and its effect on children? Has she any information about such steps within the Australian television system?

Senator Dame ANNABELLE RANKIN:

-I think it was at the weekend that I saw a Press report concerning the points the honourable senator has raised but I have not received any information from the Postmaster-General or the Minister for Health about them. I will make some inquiries to see what information I can get in relation to them.

page 924

QUESTION

POSTAL DEPARTMENT

Senator MULVIHILL:

– Has the Minister representing the Postmaster-General any information on contemplated plans to improve telephone facilities for subscribers on the Euchareena exchange in the Calare electorate?

Senator Dame ANNABELLE RANKIN:

– I know that the honourable senator has taken up this matter with the PostmasterGeneral and that the Postmaster-General is getting the information for him. It will be provided shortly. I cannot give the honourable senator any further information at present.

page 924

QUESTION

VIP AIRCRAFT

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– I ask the Minister representing the Minister for Air a further question relating to VIP aircraft. Whilst I appreciate that the Government is having another look at the rules and regulations following the misuse of a plane recently, is the Minister prepared to table the old look rules and regulations?

Senator McKELLAR:
CP

– I will transmit the question to the Minister for Air and see what his feelings are on the subject. I will let the honourable senator know the result.

page 924

QUESTION

TAXATION

(Question No. 967)

Senator MULVIHILL:

asked the Minister representing the Treasurer, upon notice:

  1. Is there a difference in the method upon which income tax is assessed in relation to professional boxers, professional footballers, and authors over a period of (a) 1 year’s earnings; (b) 3 years’ earnings; and (c) J years’ earnings in Australia, Britain, United States of America, and Canada?
  2. Are there any variations in the income tax impact on professional footballers’ signing-on fees in any of the countries mentioned in1. above?
Senator ANDERSON:
LP

– The Treasurer has provided the following answer to the honourable senator’s question:

I am not in a position to speak with authority on the taxation laws of other countries.I have, however, set out what I understand to be the position in the overseas countries mentioned. It is as follows:

In Australia. Great Britain and Canada the income tax laws contain special provisions that may apply to reduce the tax payable by an author whose income includes payments for the assignment of copyright in his works. None of these countries provides comparable concessions for professional boxers or footballers. The differences in the methods adopted by the three countries mentioned above appears from the following broad summary of the special provisions contained in the respective laws of those countries:

In Australia the provisions may apply to an author whose assessable income of a particular year includes lump sum earnings, and other abnormal income in excess of $1,000, from the assignment of copyright, advance royalties, literary prizes, etc. The general effect of the provisions is to exclude two-thirds of the abnormal income in ascertaining the rate at which tax will be imposed on the author’s taxable income for that year.

In the United Kingdom an author in receipt of income by way of royalties or from the assignment of copyright may be allowed to spread that income over 2 taxation years where he had been engaged for more than 12 months but less that 24 months on the work from which the income was earned. If the period of producing the work had exceeded 24 months, the income may be spread over 3 financial years.

The Canadian provisions apply to income from the assignment of copyright, but not royalties, derived by an author who has been engaged for more than 12 months in producing the work the copyright in which was assigned. Where the period of production is not greater than 2 years the income will be spread over 2 taxation years. Where the work took more than 2 years to produce, the income is spread over 3 years.

The United States docs not have special provisions in its income tax law relating to the assessment of tax on authors, professional boxers or professional footballers. Taxpayers generally may be entitled to average their income in a year where an unusuallylarge amount of taxable income has been derived and this may provide a measure of relief for taxpayers, including the special classes of persons mentioned above, in any year where the taxable income, with certain adjustments, exceeds by more than one-third the average of the taxable incomes of the four preceding years.

In none of the four countries mentioned does the income tax law specifically refer to professional footballers’ signing-on fees. While it is necessary to consider each case in the light of its particular facts, generally speaking signing-on fees paid to professional footballers would be regarded as income derived in the year in which the payment is made.

page 925

QUESTION

GREAT BARRIER REEF

(Question No. 885)

Senator KEEFFE:
QUEENSLAND

asked the Minister representing the Prime Minister, upon notice:

  1. With reference to the studies of the Great Barrier Reef and the sea-bed off the Queensland coast, which are currently being carried out by Japanese scientists and a small complement of Australians, what proportion of the information being gathered will be transmitted to the Japanese Government for use by that country?
  2. Is any of this research being carried out with a view of locating possible oil or gas bearing areas?
Senator ANDERSON:
LP

– The Minister for National Development has provided the following reply to the honourable senator’s question:

  1. All scientific data gathered during the oceanographic survey will be shared with all participating scientists and that which is suitablewill eventually be published. Over the period of the survey there will have been 16 Australian and 4 Japanese scientists engaged on the survey.
  2. The research is not aimed at the location of possible oil and gas bearing areas.

page 925

QUESTION

COMMONWEALTH SUPERIOR COURT

(Question No. 1028)

Senator McCLELLAND:
NEW SOUTH WALES

asked the Minister representing the Attorney-General, upon notice:

  1. In what manner is it expected that the duties of the unoccupied position of Inspector-General of Bankruptcy will be affected by the establishment of the Commonwealth Superior Court?
  2. Bearing in mind the Attorney-General’s statement, in his answer of 25th February 1969 to question No. 797, that ‘these matters should be resolved shortly’, is the Attorney-General yet able to advise when an appointment to the position will be made?
  3. Has the Commonwealth Public Service Board at any time requested the AttorneyGeneral’s Department to make a recommendation for the appointment of a person to the position? If so, when was the request first made?
Senator WRIGHT:
LP

– The AttorneyGeneral has provided the following answer to the honourable senator’s question:

  1. and 2. An appointment to the statutory office of Inspector-General in Bankruptcy has been made pursuant to the provisions of section 16 of the Bankruptcy Act 1966-1968. The Public Service position is temporarily occupied. On the establishment of the Commonwealth Superior Court the Inspector-General in Bankruptcywill cense to have administrative responsibility for the staff of existing bankruptcy registries in each of the States and this staff will become part of the registries of the Superior Court which will exercise bankruptcy jurisdiction.
  2. No.but there has been correspondence between the Board and the Department from time to time concerning the duties and the classification of the Public Service Office. The Board is currently examining these matters.

page 926

QUESTION

BURDEKIN DAM

(Question No. 1037)

Senator KEEFFE:

asked the Minister representing the Prime Minister, upon notice:

Has a request been received from the Queensland Government during the last 3 weeks for a re-appraisal of the Burdekin Dam scheme?

Senator ANDERSON:
LP

– The answer to the honourable senator’s question is as follows:

No.

page 926

QUESTION

STANDARDISATION OF RAIL GAUGES

(Question No. 1048)

Senator BISHOP:

asked the Minister representing the Minister for Shipping and Transport, upon notice:

  1. Is it a fact that successive South Australian Governments have made submissions to the Commonwealth in connection with the standardisation of the remaining broad and narrow gauge sections of the South Australian railways, as agreed to in the 1949 Railways Standardisation Agreement, and that the only offer from the Commonwealth, late last year, was to provide a team of independent consultants to study the Adelaide-Port Pirie standardisation project?
  2. What is the current position in respect to studies by the consultants?
  3. Docs the Government still insist on restricting any studies to the single project of the Adelaideinterstate connection?
Senator SCOTT:
LP

– The Minister for Shipping and Transport has provided the following answer to the honourable senator’s question:

  1. In March 1964 the South Australian Government submitted a proposal for conversion of the existing railway, plus new construction, to provide a standard gauge connection between Crystal Brook and Adelaide. The estimated cost of this work including rolling stock, was advised as $12 million. The Commonwealth agreed to examine this proposal and offered to provide funds for detailed surveys. The necessary detailed surveys have not been carried out, nor have detailed plans supporting the original proposal been submitted. In June 1968 the South Australian Government sought approval for a much wider scheme of conversion, new construction, and provision of rolling stock. Whilst detailed estimates, plans and surveys have not been prepared, such work could cost of the order of $50m. It was agreed this proposal would be referred to independent engineering consultants to report on the work which could be justified for efficient railway operations.
  2. The proposed terms of reference for the study are still under discussion between the two governments.
  3. This proposed study is restricted to the most efficient way of achieving rail standardisation between Adelaide and the interstate railway, including the question of the most efficient way of dealing with traffic on branch lines, and provision of necessary rolling stock. Other studies are continuing with respect to railway standardisation and proposed new construction in other areas of South Australia.

page 926

QUESTION

TELEVISION ADVERTISING

(Question No. 1083)

Senator O’BYRNE:

asked the Minister representing the Postmaster-General., upon notice:

  1. With reference to a report that the United States Federal Trade Commission has accused television advertisers for Campbell’s soup of deception, because they used hidden glass marbles, did the Commission allege that the advertisements were false and deceptive because they showed a bowl of soup apparently well filled with solid pieces of food, when in fact it was partly filled with marbles?
  2. Does this soup company have a subsidiary in Australia?
  3. Are the advertisements referred to as being under challenge presented on Australian television?
  4. What controls are exercised over television advertisers to prevent them using false and deceptive methods to deceive consumers?
  5. Have any prosecutions been launched in the past against advertisers for this kind of practice: if so, could the Postmaster-General give the Senate full details of the prosecutions and their result?
Senator Dame ANNABELLE RANKIN:

– The Postmaster-General has provided the following answer to the honourable senator’s question:

  1. I have seen Press reports to the effect stated by the honourable senator.
  2. I am aware that Campbell’s soups are marketed in Australia but the arrangements under which they are marketed are not within my knowledge.
  3. No. The use of imported television advertisements are not permitted on Australian television under rules determined by the Australian Broadcasting Control Board.
  4. The television programme standards of the Australian Broadcasting Control Board contain certain provisions directed towards ensuring that advertisements televised are not misleading. It must be emphasised, however, that legal requirements regarding advertising practices, including the question of truth in advertising, are primarily a matter of State law. 1 am aware that State Governments have been active in the matter. There is a provision in the Board’s standards relating to advertising that all advertisements must comply with the laws of the Commonwealth and States. In addition to the requirements of the Board’s standards, certain measures of self regulation have been taken by the industries concerned and their codes of practice contain provisions concerning truth in advertising.
  5. I can only say that no prosecutions have been launched under the statutes administered by the Postmaster-General.

page 927

QUESTION

NATIONAL SERVICE

(Question No. 1085)

Senator POKE:
TASMANIA

asked the Minister repre senting the Minister for Labour and National Service, upon notice:

Is it a fact that a person who is a member of the Citizen Military Forces and who is young enough to register under the National Service Act can be discharged as unsatisfactory to the Citizen Military Forces and is then subject to all the provisions of the National Service Act, including being compelled to serve in Vietnam?

Senator WRIGHT:
LP

– The Minister for Labour and National Service has provided the following answer to the honourable senator’s question:

Anyone who is a member of the Citizen Forces or who undertakes to join the Citizen Forces at the time when he is required to register for national service, may elect to serve in those Forces as an alternative to full-time national service. Provided he serves efficiently for the required period, he will not be called up. Should he fail to do so he becomes liable to be called up for full-time national service.

page 927

QUESTION

IMMIGRATION

(Question No. 1093)

Senator WHEELDON:

asked the Minister representing the Minister for Immigration, upon notice:

  1. In the period 1945-1967, how many people of non-European origin have been admitted into Australia for permanent residence, in each year, from the following countries: (a) Indonesia, (b) China (Formosa, Hong Kong and Mainland China), (c) India, (d) Pakistan, (e) Burma, and

    1. Mauritius?

  2. In the period 1945 to 1967, what have been the requirements governing the entry into Australia of persons of mixed origin, how many persons of mixed origin have entered Australia for permanent residence, in each year, and how many persons were within the various categories such as

Anglo-Indians. Anglo-Burmese, Mauritius-Creoles, etc.?

  1. Was the agreement arrived at during the Imperial Conference of 1918, insofar as it related to the admission of peoples of Indian origin, operative between 1945 and 1967, and, if it is no longer operative, when did it cease?
  2. Were the concessions agreed to by Australia and India during the 1918 Conference extended to Pakistan, Burma and Ceylon after those states became independent; if so, are they still operative?
Senator Dame ANNABELLE RANKIN:

– The Minister for Immigration has provided the following answer to the honourable senator’s question:

  1. Until the second half of 1961 statistics were not maintained of the number of non-Europeans admitted during given periods. It is not possible, therefore, to supply annual arrivals prior to 1st July 1961. In addition, prior to the March 1966 review of policy, statistics were maintained under four broad nationality headings only. Available statistics covering the entry of persons of nonEuropean descent during the period 1st July 1961 to 31st December 1965 are:

Statistics available in relation to the entry for residence of persons of non-European descent during the period of 1st January 1966 to 31st December 1968 are based on nationality and not country of former residence. The detailed nationality statistics are:

  1. Duringthe period 1945to September 1964 persons of mixed descent were eligible for admission to Australia provided they appeared to be fully European in upbringing, outlook, mode of dress and way of living, and appeared to be predominantly European to the extentthat they would be unlikely to experience difficulty in being accepted as Europeans in Australia. Under present policy, which came into operation in September 1964, eligibility for entry is dependent firstly on whether the applicant is judged to be, by reason of his appearance, education, upbringing, outlook, mode of dress and way of living, capable of ready integration into the Australian community and secondly on whether:

    1. humanitarian considerations, involving close family relationships or hardships on grounds of discrimination, are present; or
    2. the applicant has special knowledge, experience or qualifications useful to Australia; or
    3. the applicant has the abilityto make a contribution to Australia’s economic, social or cultural progress.

Detailed statistics of the arrival in Australia of persons of mixed descent were not maintained unitil early in 1965. Statistics maintained of arrivals since 1st April 1965 are:

3 and 4. The reciprocal agreement entered into following the Imperial Conference of 1918 is still operative. The concession was extended to Pakistan and Ceylon but not to Burma. It will be realised that the arrangement no longer has the significance which it had earlier because non-Europeans generally are eligible to enter as the dependants of residents of Australia. Their eligibility for entry resulted from a decision reached in 1959.

page 928

QUESTION

DEPARTMENT OF CUSTOMS AND AND EXCISE

(Question No. 1098)

Senator MURPHY:
NEW SOUTH WALES

asked the Minister for

Customs and Excise, upon notice:

  1. Why was the search of Mrs Weaver’s house proceeded within the absence of Mr Weaver although Mrs Weaver repeatedly told the customs officers that he would be home shortly?
  2. Why did the officers refuse to give a receipt for two walkie-talkie radios taken from the home?
  3. Is it correct that no charges have been laid against Mr Weaver or in respect of the radios?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

  1. The search of Mrs Weaver’s house was one of four simultaneous investigations. It was necessary to co-ordinate the four operations. Mrs Weaver advised the customs officers that her husband might not return for possibly a long time and that she had no idea when he would return. The search took approximately 20 minutes. Mrs Weaver assisted the officers in the search, which resulted in the discovery of two transceivers.
  2. It is the usual practice to give a receipt for seized goods only upon request.In this case the officers were not askedto give a receipt.
  3. Legal action has been commenced in connection withthe two transceivers.

page 928

QUESTION

DEPARTMENTOF CUSTOMS AND AND EXCISE

(Question No. 1118)

Senator McCLELLAND:

asked the Minister for Customs and Excise, upon notice:

  1. Have two officers of the Department of Customs and Excise recently been engaged in investigating and checking ships’ papers relating to ships enteringthe port of Sydney during 1968?
  2. Has the investigation revealed that a large quantity of cargo that came into Australia in such ships cannot be accounted for?
  3. What is the estimated quantity of cargo that cannot be accounted for?
  4. Has a large tonnage of cargo left customs control without the Department being able to verify payment of duty; if so, what is the estimated quantity of the cargo?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

  1. 1 am not sure of the information the honourable senator is seeking. In fact, a great many officers at each Customs House are continuously engaged in investigating and checking ships’ papers. Even after the normal procedures are completed, this check is maintained by the central manifest accounting system and internal check as illustrated in my reply to question No. 1074.
  2. No.
  3. Subject to the procedure referred to in my answer to question No. 1073, virtually all the cargo that arrived in the port of Sydney during 1968 was promptly delivered, although the final act of writing off the entry against the manifest may not yet be complete. However, as part of the activities of the central manifest accounting system and the internal check, queries have been raised to ensure that the documents relating to each item of cargo are brought together to enable the papers to be finalised (see answer to question No. 1074).
  4. No. There were some 464,000 manifest lines of cargo imported through Sydney in 1968. There have been isolated instances where cargo has left customs control without payment of the appropriate duty. The Department is almost invariably successful in collecting duties that have been shortpaid

page 929

QUESTION

DEPARTMENT OF CUSTOMS AND EXCISE

(Question No. 1119)

Senator MCCLELLAND:

asked the Minister for Customs and Excise, upon notice:

  1. Does the system of commodity control relate to companies and bond proprietors operating in connection with the importation of spirits?
  2. What action, if any, has been taken against bond proprietors for evasions of duty in relation to spirits?
  3. What evasion of duty was involved and what was the amount of fine and/or other penalty imposed in each case?
  4. What was the name of each company and bond against which action was taken, and who were the actual bond proprietors?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

  1. The system of commodity control relates to companies and bond proprietors operating in connection with both imported and exciseable spirits. 2, 3 and 4. The system of commodity control replaces a system which in various forms has been in operation since Federation where officers physically supervised the activities of various licensed customs warehouses or ‘bonds’. Under commodity control the operations are supervised from the account books and documents of the bonds prepared in a manner satisfactory to the Department and by planned investigations of company documentary and physical controls.

The new system is radically different from the old system. In the course of instructing companies operating in the excisable and imported spirits area of the requirements of the new system, certain discrepancies both between States and between individual companies in calculating bottling allowances were discovered as indicated in my speech of the 16th April. In some cases, these discrepancies bad existed over a number of years. In other cases, it was discovered that some bond proprietors were making a practice of releasing spirits prior to the payment of duty, although the Department is satisfied that they had no intention of ultimately avoiding the duty involved.

The Department accepted that there was some confusion in the minds of the companies concerned as to the application of the remission of duty provisions of the Customs and Excise Acts as applied to spirit bottling operations. The Department called up the duty involved over the full period, and where appropriate, spirits were seized. No other legal action was considered necessary at this stage.

The companies against whom the action was taken were as follows:

Seventy-four cases of spirits were seized from D.C.L. Bond. At that time, all bond proprietors were made aware of the exact provisions of these Acts. It was made clear that a repetition of these occurrences would result in appropriate legal action. Since that time, action has been taken against one company, details of which have been given in reply to Question No. 1279 in the House of Representatives. Investigations are at present proceeding into the activities of a number of other companies, as indicated in the answer to Question No. 1122 in the Senate.

page 929

QUESTION

DEPARTMENT OF CUSTOMS AND EXCISE

(Question No. 1110)

Senator MCCLELLAND:

asked the Minister for Customs and Excise, upon notice:

  1. How many officers of the Department of Customs and Excise are acting in positions higher than their substantive positions?
  2. For how long has each of these officers been acting in such higher position?
  3. What action is contemplated to appoint permanent officers to these higher positions?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

The Comptroller-General of Customs has advised me:

  1. The number of officers acting in positions higher than their substantive positions for a period in excess of 1 month is 1,217.
  2. –

There is always a large number of officers temporarily occupying higher positions in the Department. This is caused mainly by the absense of other officers on leave, such as sick, recreation or furlough; officers absent on training courses; and the delay in confirming promotions subject to appeal.

At the present time, the position is aggravated by the introduction of comprehensive establishment changes to implement widespread new procedures in the Department and the need to place certain officers whose positions have become redundant because of the introduction of commodity control.

  1. As at the 23rd April 1969, 221 officers will have been provisionally promoted, but the date of confirmation of these promotions will depend upon the outcome of appeals, if any, against these promotions. Action is in train to fill all other vacant permanent positions. However, for the reasons mentioned above, a number of officers will continue to act in positions higher than their substantive positions.

page 930

QUESTION

DEPARTMENT OF CUSTOMS AND EXCISE

(Question No. 1121)

Senator MCCLELLAND:

asked the Minister for Customs and Excise, upon notice:

  1. In relation to the 441) hours overtime worked by the twenty-eight officers of the Central Manifest Accounting Section in February 1969 and the 699 hours overtime worked by these officers in the first 3 weeks of March 1969, for how long has the backlog of work, referred to by the Minister in his answer to question No. 1075, been developing?
  2. What is the estimated amount of overtime required to be worked by these same officers to overcome the existing backlog?
  3. When is it anticipated that the backlog will be overtaken?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

  1. The backlog of work built up during the latter part of 1968 and the early months of 1969. 2 and 3. The Comptroller-General of Customs advised me that the nature of the work in this section is such that this backlog is not serious and does not call for untoward overtime. The backlog will be gradually removed by certain staffing changes, with appropriate overtime.

page 930

QUESTION

CUSTOMS AND EXCISE

(Question No. 1122)

Senator MCCLELLAND:

asked the Minister for Customs and Excise, upon notice:

  1. What legal action has been taken against a company operating in the excisable spirit area since the introduction of the commodity control that is referred to in the Minister’s answer to question No. 1059?
  2. Was legal action taken as a result of evasion of duty? If to, what was the amount of duty involved, and what was the quantity of liquor involved?
  3. What is the name of the company involved and who are the directors of the company?
  4. What has been the result of the legal action taken?
  5. What are the ‘certain other companies’ involved - referred to by the Minister in bis answer to question No. 1059- and how long have the investigations been under way?
  6. Who are the actual bond proprietors of the Argyle Bond and Free Stores, which was referred to by the Minister in his answer to question No. 1279 asked in the House of Representatives?
  7. Who are the directors of Australian Rum Distillers (Sydney) Pty Ltd, referred to in the Minister’s answer to question No. 1279 asked in the House of Representatives?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows: 1, 2 and 4. See answer to question No. 1279 in the House of Representatives, 3 and 7. At the time of the investigation, the records of the Registrar of Companies indicated that the directors of Australian Rum Distillers (Sydney) Pty Ltd were S. A. J. McMahon, S. A. Woodall, N. N. Mainwaring and W. T. Eastgate

  1. The investigations into the other companies referred to in my answer to question No. 1059 have been in train for varying periods up to 3 months. It would not be proper for me to reveal at this stage the names of these other companies since the investigations may disclose no evasion of duty or in some cases legal action may result when the investigations are finalised.
  2. At the time of the investigation the records of the Registrar of Companies indicated that the shareholders of this firm were S. A. J. and B. McMahon.

page 930

QUESTION

CUSTOMS AND EXCISE

(Question No. 1 1 24)

Senator MCCLELLAND:

asked the

Minister for Customs and Excise, upon notice:

  1. In connection with the four cartons of machine parts which were sold in error at a Customs sale in October 1968 - referred to by the Minister in his answer to question No. 1056- for how much were the goods sold at the sale?
  2. What was the financial settlement that was made with the purchaser?
  3. What was the amount of duty payable on the goods by the importer?
Senator SCOTT:
LP

– The answer to the honourable senator’s question is as follows:

  1. Fifty dollars.
  2. Four hundred and twenty dollars.
  3. The four cartons sold formed part of a larger shipment all of which was entered through Customs on a single duty paid entry. The duty attributable to the four cartons would be approximately S86.

page 931

QUESTION

CUSTOMS AND EXCISE

(Question No. 1127)

Senator FITZGERALD:

asked the Minister for Customs and Excise, upon notice:

  1. Were investigations made by the Department of Customs and Excise into the operations of Australian Rum Distillers (Sydney) Pty Ltd, which carries out under bond the bottling of various spirits in the Argyle Bond and Free Stores, Sydney, in August 1968 as a result of which fifty-seven 8/12 cases of spirits were seized and duty of $2,514.47 was called up?
  2. If so, what action is being, or is to be, taken by the Department to find out whether this fraudulent practice was carried on over a number of years prior to the raid on this bond?
  3. Is the Department satisfied with the $200 penalty that was imposed on the company?
  4. What is and has been the policy of the Department to ensure checks on the activities in previous years of companies found guilty of having been engaged in such fraudulent practices?
  5. Is the largest shareholder and managing director of the firm in question the man who has announced his intention to contest the federal seat of Warringah and, if elected, has announced he will give his parliamentary salary to pensioners and the poor?
Senator SCOTT:
LP

– The answer to the honourable Senator’s question is as follows:

  1. Yes.
  2. When normal Departmental check procedures disclosed discrepancies, a detailed investigation was made of the past operations of the company. This investigation found no evidence of stock discrepancies other than those referred to in part 1. of the honourable senator’s question.
  3. The $200 penalty is the maximum prescribed for an offence under section 120 (VII) of the Excise Act.
  4. No arbitrary time limit is set by the Department in checking previous activities of companies. Investigations are taken back as far as is necessary to satisfy officers that no revenue has been avoided. 5.I have no personal knowledge of the political aspirations of any of the directors or shareholders of this company.

page 931

QUESTION

F111 AIRCRAFT

Senator ANDERSON:
LP

– On 26th March, Senator Cohen asked me a question related to interest payments on moneys borrowed from the United States for the purchase of the F111 aircraft. I undertook to refer the question to the Minister for Defence, who has now provided the following answer:

Interest payments at 4% on money borrowed to finance the purchase of F111C aircraft are made at half-yearly intervals. To date the following interest payments have been made:

page 931

REPORT OF PUBLIC WORKS COMMITTEE

Commonwealth Hostel, Alice Springs, Northern Territory

Senator DITTMER:
Queensland

– I present the report of the Parliamentary Standing Committee on Public Works relating to the following proposed work:

Commonwealth Hostel, Alice Springs, Northern Territory

I ask for leave to make a short statement.

The ACTING DEPUTY PRESIDENT (Senator Bull) - There being no objection, leave is granted.

Senator DITTMER:

– The summary of recommendations and conclusions of the Committee is as follows:

  1. Further major maintenance or rehabilitation of Todd and Stott houses would be uneconomic.
  2. There is expected to be a continuing and increasing need for single accommodation for Commonwealth officers and employees at Alice Springs.
  3. There is a need for the work in this reference.
  4. The Northern Territory Administration should consult with the Young Womens Christian Association with a view to, if necessary, making further land available to that organisation, but without prejudicing the Commonwealth’s hostel proposals.
  5. Subject to recommendation 4, the Committee agrees that the site selected is suitable.
  6. The Committee recommends the construction of the work in this reference.
  7. The estimated cost of the work when referred to the Committee was $1.7m.

page 931

GENERAL BUSINESS

Suspension of Standing Orders

Motion (by Senator Murphy) agreed to:

That so much of the Standing Orders be suspended as would prevent Senator Murphy moving a motion relating to the order of General Business after 8 p.m

Senator MURPHY:
New South WalesLeader of the Opposition

– I move:

This will have the effect of bringing on at 8 p.m. the debate on the lifting of the embargo on the export of merino rams.

Question resolved in the affirmative.

page 932

SPECIAL ADJOURNMENT

Senator ANDERSON:
Minister for Supply · New South Wales · LP

[4.4J - I move:

I indicated earlier that the Senate would, at its rising, adjourn till tomorrow at 10.30 a.m. I have been informed that the other place will adjourn tonight till 10.30 a.m. tomorrow. In keeping with tradition, I have therefore moved that the Senate, at its rising, adjourn till tomorrow at 1 1 a.m. I do not think that this will inconvenience anybody.

Question resolved in the affirmative.

page 932

INCOME TAX ASSESSMENT BILL 1969

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Anderson) read a first time.

Second Reading

Senator ANDERSON:
Minister for Supply · New South Wales · LP

[4.51 - I move:

The main purpose of this Bill is to amend the Income Tax Assessment Act to exempt from lax income derived from the sale of newly mined gold for industrial use in Australia. The Bill will also correct a technical defect in provisions of the Act relating to export market development expenditure. All newly mined gold produced in Australia, Papua and New Guinea is required to bc delivered to the Reserve Bank. The exemption proposed by the Bill is the result of changed arrangements for the marketing of gold after its delivery to the Bank. These new arrangements became operative on 18th March 1968. Until that date all newly mined gold used for industrial purposes in

Australia was supplied to users by the Reserve Bank at basically the official’ price. This gold was provided out of the newly mined gold delivered by members of the Gold Producers’ Association Limited. Since the incorporation of the Association in 1951, the balance of its members” deliveries has been available to it for purchase from the Bank at the official price for sale outside Australia at prices in excess of the official price.

On 1 8th March 1968, the Reserve Bank ceased to supply gold to Australian industrial users. Since, that date, the Gold Producers’ Association has been authorised to purchase from the Bank, at the official price, the whole of its members’ deliveries of newly mined gold and to export that gold, or sell it for industrial use in Australia, at market prices. Provisions of the income tax law have, for many years, exempted from tax income derived by gold producers from the gold they produce. These provisions were extended in 1951 when the export of newly mined gold by an association of gold producers was permitted by the Government. The extended income tax exemption applied lo the income derived by such an association from its export sales of gold produced by its members and to dividends paid to its members out of such income. Now that the Government has approved new gold marketing arrangements under which gold producers may derive income from the sale of their gold production through their Association to industrial users in Australia, it is appropriate that the income of the Association and its members from this source should also be exempt from tax. The Bill proposes, therefore, lo extend the existing exemptions relating to export sales of gold to cover, firstly, income derived by an approved company owned by producers of gold, in Australia. Papua or New Guinea from the sale for industrial use in Australia of gold produced by those producers and. secondly, dividends paid by the company to those producers out of that exempt income.

I turn now to the second amendment proposed by the Bill. This will effect a drafting change in legislation enacted last year lo continue in a revised form the income tax incentive for export activity. The incentive is now provided by way of a special income tax rebate of 42.5c for each $.1 of eligible expenditure incurred in promoting the export of goods and services from Australia. The rebate is in addition to any deduction allowable for the same expenditure under the general provisions of the income tax law. Special provisions apply, however, to limit the aggregate amount of tax that may be saved by the allowance of both the rebate and a deduction in respect of the same amount of promotional expenditure. The upper limit on the tax saving is 87.5c for each $1 of such expenditure. In appropriate cases, the rebate of 42.5c is reduced by such amount as may be necessary to prevent the tax saving limit being exceeded.

The existing legislation contains complex provisions to enable the appropriate amount of tax saving to be calculated in the varied circumstances under which expenditure eligible for the export market development rebate may be allowed as a deduction in the income tax assessments of taxpayers. There is, how ever, a technical defect in these provisions which prevents the tax saving in respect of the deduction from being calculated, in some cases, on the basis originally intended. In broad terms, these are cases where a taxpayer is entitled in the one income tax assessment to a deduction for export market development expenditure and also to a deduction for losses which he incurred in a prior year of income.

This Bill will correct the technical defect and ensure that the lax saving provisions relating to deductions will produce, in all circumstances, the amount of tax actually saved by a deduction in respect of eligible export market development expenditure. More detailed explanations of the Bill are contained in the explanatory memorandum that has been circulated for the information of honourable senators and I do not propose to speak at greater length at this stage. I commend the Bill to the Senate.

Debate (On motion by Senator Wilkinson) adjourned.

page 933

PAY-ROLL TAX ASSESSMENT BILL 1969

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Anderson) read a first time.

Second Reading

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I move:

That the Bill be now read a second time.

It is proposed by this Bill to amend the pay-roll tax law as it applies to one aspect of the rebates of tax for increases in export sales. The amendment will ensure that sales of newly-mined gold for industrial use in Australia are not taken into account in determining the rebate entitlements of gold producers. These amendments are a consequence of changes in arrangements for the marketing of newly mined gold for industrial use in Australia which became operative on 18th March 1968.I have already mentioned these changes in my speech on the associated Income Tax Assessment Bill just introduced.

Under the present law authorising rebates of pay-roll tax for increases in exports, the total production of a gold producer is. on delivery to the Reserve Bank, treated as an export sale for rebate purposes. This is so even though the gold may subsequently be exported, sold for industrial use in Australia or held by the Bank. Tax exempt dividends received by the producer from an approved producer owned company out of the profits earned on export sales of newly mined gold at market prices are similarly treated. As to this latter aspect, I remind honourable senators that distributions made by the Gold Producers’ Association will, under the revised gold marketing arrangements, now include also profits on sales by the Association to local industrial users of gold.

The Government has reviewed the payroll tax rebate scheme as it applies to gold producers in the light of these revised marketing arrangements and of the fact that, since the rebate scheme was introduced in 1961, there has been a substantial increase in the extentto which newly mined gold is sold for industrial use in Australia. In the Government’s view, gold producers should no longer be entitled to the rebate in respect of that part of their production that is sold for industrial use in Australia. It is proposed therefore that, when calculating the rebate entitlement of a gold producer who is a member of a producer owned company, a proportion of the producer’s deliveries to the Reserve Bank and of the dividends he receives from the company be excluded from the value of his export sales for the particular rebate year. The proportion will represent the extent to which the company’s sales of newly mined gold in the year preceding the rebate year were for industrial use in Australia.

Very broadly, entitlement to a rebate of pay-roll tax is calculated in relation to the amount by which export sales for the rebate year exceed export sales in a prior base period. Accordingly, adjustments corresponding to those 1 have outlined in relation to rebate years are to be made to the export sales of the relevant base period years. The proposed amendments will apply to rebate claims in respect of the 1968-69 financial year and subsequent financial years. A memorandum explaining each clause of the Bill has been circulated for the information of honourable senators and I do not propose to go into further detail at this stage. I commend the Bill to the Senate.

Debate (on motion by Senator Wilkinson) adjourned.

page 934

AUDIT BILL 1969

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Anderson) read a first time.

Second Reading

Senator ANDERSON:
Minister for Supply · New South Wales · LP

– I move:

That the Bill be now read a second time.

The principal matters dealt with by this rather technical Bill relate to the GovernorGeneral’s warrant, which is required to be obtained before money voted by Parliament may be disbursed. The procedure set out in the present Act provides for the Treasurer to calculate the amount of money likely to become payable out of the Commonwealth public account for a period of not more than 3 months, to classify it in the same divisions and sub-divisions employed in appropriating it or state the purpose for which it will become payable, and to obtain warrant accordingly. A quite separate control is imposed by another section of the Act which provides the machinery to restrict expenditure in the year on each item of the schedules to the Appropriation Acts to the amount appropriated by Parliament for the year.

The existence of a control on a subdivisional basis for a quarter or shorter period in addition to a separate control on an item basis for a year complicates departmental and Treasury administration. Before the introduction of computers, the central Treasury ledgers were maintained at subdivision level. Now that computers are used in Treasury accounting, all records are maintained at item level and the reasons which were previously valid for warrant control to be based on sub-division totals no longer apply. Present methods also provide information much more quickly, and as frequently as is desired, both to Treasury and departments. Since the rate of expenditure can be observed so readily, the need to provide a quarterly warrant has also disappeared. It is therefore proposed to coordinate these controls by providing warrant control at item level and by permitting warrants to be obtained for the full amount appropriated, and not merely for the amount expected to be spent in 3 months or less. The savings from these changes in warrant procedures are expected to be of the order of $100,000 a year.

Another change proposed in the warrant procedures relates to the Trust Fund. Under the present law warrant is required to bc obtained for Trust Fund expenditure, but this serves no useful purpose. Trust Fund expenditure is controlled by ensuring that expenditure from a trust account does nol exceed the amount available in that account. It is therefore proposed to remove the requirement for warrant to bc obtained for expenditure from the Trust Fund. The Auditor-General must sign each warrant before it is presented to the GovernorGeneral and there have been difficulties in obtaining his signature when he is away from Canberra. It is therefore proposed to provide that he may appoint a person lo sign the certificate in the warrant in his place. The other changes in the sections dealing with the Governor-General’s warrant are not designed to change the current practice, but to bring the law clearly into line with this practice. Thus it is probable that, strictly, warrant is not at present required where Parliament has provided an appropriation which it is known will be used by the department controlling that appropriation for making a payment to another department or agency - such as payments for stationery and printing to the Government Printer.

The amendments are designed to make it clear that warrant is required for all such amounts appropriated by Parliament, in order to co-ordinate the warrant control with the appropriation control. Another change designed to bring the law into line with present practice is contained in the provision permitting the Governor-General to issue a warrant without obtaining the advice of the Executive Council. The practice is for the Governor-General to sign the warrant after the Treasurer has signed it showing the amounts required and the Auditor-General has signed it certifying that the amounts are legally available without the additional step of an Executive Council minute in this time-critical operation, and as far as can be ascertained this has been the practice since federation. However the Acts Interpretation Act provides that unless the contrary intention appears references in Acts conferring a power or function on the Governor-General are to be read as referring to the Governor-General acting with the advice of the Executive Council. The Bill therefore provides a contrary intention.

The opportunity has been taken to make a number of other desirable amendments, most of which will not change the current practice. Thus in its sixty-first report, the Joint Committee of Public Accounts noted difficulties arising from the inclusion of deduction and transfer items in the schedules to the various appropriation measures. A new section to deal with this problem is proposed. It is also proposed to validate the accounting procedures followed where there are amounts both due to and by the Commonwealth and these are set off one against the other when settlement is made. The wording of the Act has also been modernised in a number of ways, in particular by replacing the words ‘His Majesty’ by “The Commonwealth’ and by removing a number of references to the Treasurer’s deputy which are not used or needed in view of the Treasurer’s power of delegation. The Act has also been divided into numbered parts.

There are three other matters where rather more is involved than mere modernisation of wording or clarification of the law relating to existing procedures. In situations where a deceased estate is small, amounts due to the deceased person by the Commonwealth are paid without production of probate or letters of administration. It is proposed to provide authority for such payments in the Act, to ensure that the Commonwealth is free from further liability. The penalty provisions have also been revised and the penalties brought into line with those provided in the Crimes Act. Finally, where the Auditor-General is at present required to report every sum exceeding $200 allowed without vouchers or certificates or with imperfect vouchers or certificates, it is proposed to change the amount of $200 which was fixed over 20 years ago to an amount of $1,000. This will not of course prevent the Auditor-General from reporting any such case no matter how small the sum if he considers it appropriate to do so. I commend the Bill to honourable senators.

Debate (on motion by Senator Fitzgerald) adjourned.

page 935

RAW COTTON BOUNTY BILL 1969

Second Reading

Debate resumed from 17 April (vide page 914), on motion by Senator Scott:.

That the Bill be now read a second time.

Senator O’BYRNE:
Tasmania

– When the Senate adjourned on Thursday 17th April I had indicated that the Opposition would move an amendment. I now formally move:

Leave out all words after That’ - insert the Bill be withdrawn and re-drafted to provide-

for the payment of a bounty of$4m on total production of raw cotton for the year commencing on the first day of March, one thousand nine hundred and sixty-nine;

for an immediate review of the economic position of the raw cotton industry with the object of providing adequate financial assistance to those areas which are still in need of a bounty, and which have not yet had time to become established viable economic units, such as the Ord River and the Queensland irrigation areas; and

that special financial payments to assist the developing areas to become established viable economic units be implemented within section 96 of the Constitution’.

To elaborate these proposed amendments, it is necessary perhaps to recount that the raw cotton industry has expanded in a very dramatic way in Australia over a short period. Because of the great success achieved in the Namoi area of New South Wales, it did not take a great deal of time before the first objective of cotton growing here - to supply our own domestic needs - was achieved. Figures have been quoted which show that not only has this objectivity been achieved but those who have been associated with the growing of the cotton have enjoyed considerable prosperity.

When 1 was speaking to this Bill before, 1 did say that a survey carried out by the Bureau of Agricultural Economics had disclosed a certain net farm income for the farmers of the Namoi area where from 70% to 80% of Australia’s total production of cotton is grown. 1 pointed out that the physical and financial data were obtained from a total of 1 54 cotton producers and the sample which had been given to the Minister for Primary Industry (Mr Anthony) represented some 75% of growers who planted more than 20 acres of cotton in 1966-67. I had pointed out that the largest individual mw cotton producer in New South Wales was omitted from the survey results as being atypical. This was the Austcott organisation, which is a very big producer in the Namoi area. If we look at the figures we see that the net farming income for the 3-year period was $69,767. The bounty content was $41,340. I pointed out that although this seemed to be quite a considerable net income, a considerable proportion of this income was returned to the Treasury by way of taxation and that it could quite easily come close to equalling the amount of the bounty, which was about $41,000. lt would only need to be a little over 50% of the total amount raised on this average income from the 154 cotton producers in this area. On the other hand, in addition to income tax, which is a direct take by the Government, indirect taxation on so many of the commodities that are used in transport, production and al] other aspects of cotton growing must, be taken into account. All this means that these people who are pioneering the industry and who have been given an incentive now find that, because they have achieved a measure of success, they are to be responsible for reducing the incentive that is to be made available to cotton growers in other parts of Australia. In my view, the Government is adopting a very narrow attitude in deciding that, because of the great success achieved by 154 cotton growers in producing such a large amount of colton as t6 come very close to supplying the total local market demand for the particular type of cotton they grow, there should be an end to the encouragement of cotton growing in Australia.

In another place, the potential of the Ord River Scheme in Western Australia was pointed out. 1 understand that later today Senator Lawrie will be speaking on behalf of the Queensland cotton growers. I shall be most interested to hear their views. After all, the history of dry cotton growing, or growing cotton under natural rainfall conditions, goes back a very long time in Queensland. Queensland was the pioneer in cotton growing in Australia. Now, with new techniques and the availability - a little belatedly - of irrigation water, the Government should give some consideration to those people who are decentralising and making the best possible use of land suitable for growing cotton crops by irrigation. Again, as I said earlier, to our near north is a country teeming with millions of people who will eventually improve their standard of living to the stage where they will be able to afford to buy clothing and other commodities manufactured from cotton. In view of the industrial potential not only in this but in other countries in South East Asia. I believe it is a very shortsighted policy not to be encouraging a much higher level of cotton production.

The figures available to us disclose that in 1963-64 there were 41,000 acres under cotton. The following year, because of drought conditions in New South Wales, the area under cotton dropped to 38,000 acres, but increased again to 55,000 acres in 1965-66. The area under production has remained at approximately 53,000 acres since then in New South Wales. This should give the Senate some idea of the great forward strides that were made in the Namoi area. In my view, it would restrict and inhibit growers in other parts of Australia who could bring similar areas of land into production if we adoptetd the phasing out process suggested in this Bill. What is proposed here means that after 3 years no incentive will be offered to growers at all. Because of this, it is quite likely that new areas will not be developed.

The question was raised as to whether it is the Commonwealth’s responsibility to subsidise or to give bounties. In reply to that, I remind the Senate that the sugar industry of Queensland has been assisted consistently over the years by Australian consumers. As a result, it has brought into production farmland that perhaps never would have been developed but for the incentive offered to the Queensland sugar growers. Over the years, the Queensland sugar growers enjoyed some measure of prosperity. At the moment they are experiencing great difficulties because of international sugar agreements and other economic and political problems associated with the disposal of sugar not only from this country but from other sugar producing countries throughout the world. But the principle involved in assisting the sugar industry to become established by the adoption of a certain home consumption price could be followed to encourage the establishment of the cotton growing industry.

Another direction in which this Government has taken a shortsighted view is in basing the present consumption figure within Australia on traditional imports of cotton. I remind the Senate that the next stages in the processing of cotton after it has been grown - the ginning and the actual manufacturing of cotton goods within Australia from our own locally produced cotton - are still in their infancy and offer scope for quite it degree of development. The industry has been given a short period of time to cope with this phasing out process. The figures given by the Minister indicate that the bounty payable will be reduced to $4m for the year beginning 1st March 1969; to $3m for the year beginning 1st March 1970; and to $2m for the year beginning 1st March 1971. There will be no further bounty payable after that date. 1 want to stress that the Opposition considers that there should be an immediate review of the economic position of the cotton industry throughout Australia with particular emphasis being placed on the cotton growing areas around the Ord River and in Queensland. Instead of making our evaluation only on the successful Namoi project, we should give every encourage ment to establishing alternative cotton growing areas which can produce cotton on a viable economic footing. This economic review should determine whether Australia would be well served by dispersal and decentralisation of this young and growing industry. The future needs of Australia and of the surrounding countries also should be taken into consideration.

Senator MAUNSELL:
Queensland

– 1 support this Bill which deals with the phasing out of the cotton bounty over a 3-year period. I do so fully aware that the industry, if it ever finds itself in difficulty, can come to the Government for assistance. I oppose the indiscriminate use of bounties or of subsidies in the form of bounty or tariff protection. 1 suppose this is only natural because I am a wool and beef producer. The wool and beef industries do not receive the benefit of such bounties and subsidies and their cost structures arc affected to a great extent by tariffs and other costs. Bounties tend to encourage inefficient industries to continue operating, usually at the expense of efficient industries.

We have bounties for certain reasons. Firstly, we provide a bounty to enable an industry operating under the Australian cost structure to receive reasonable remuneration and to produce efficiently and profitably whilst at the same time not making that profit too high for the consumer to carry. The dairy industry is one example of this. Another reason for applying a bounty is to provide encouragement for industries to increase production of those items which normally are imported, with a view to reaching self sufficiency. That is why there has been a bounty on cotton production. The bounty was provided in order to encourage production sufficient to meet our own requirements. Where there is a world demand for a particular product which can be exported without a great deal of Government assistance a bounty can enable an industry to earn much needed overseas income.

If we consider the cotton industry we find that this bounty was introduced in 1964 when our cotton imports amounted to $16m. It is expected that this financial year the value of our cotton imports vfl’) be below S2m. The estimated requirement of the Australian textile industry is 130,000 bales of cotton. That figure includes 15,000 bales of long staple cotton which unfortunately we are not producing in Australia at the present time. This leaves 115,000 bales of the other types of cotton which can be produced in Australia. The estimated cotton production in Australia this financial year is 132,250 bales. This means that there will be a surplus of some 17,000 bales. It is also estimated that the present area producing cotton can produce 180,000 bales. This means, of course, that we will have a surplus for which we will have to find a market at a price at which the Australian industry can produce efficiently and profitably. The Namoi valley area produces about 78% or 80% of Australia’s cotton and therefore is producing our cotton requirements. Surveys of that area have shown that the Namoi valley can produce cotton very profitably, with a yield per acre and a profitability which are more than comparable with those of any other country. There is a vast area around the Namoi valley into which the production of cotton can be extended. Therefore we can expect to produce a considerable crop of cotton for export for which we have to find markets.

If we continue this bounty or if we encourage other areas which have not been so profitable in the past, we will increase the problem of disposing of raw cotton. Honourable senators should not forget that there is a world surplus of cotton and that markets are very hard to find. There are some reasons for this. The cotton industry is probably the main industry into which synthetics have made great inroads. I think honourable senators will agree that one of our great problems with other industries is this subsidisation of export income. Last week the Opposition complained about the expansion of the sugar industry. The sugar industry got into strife because it could not sell sugar overseas at a reasonable price. I think the price offered was $20 a ton when the costs of the Australian sugar industry required a price of about $60 or $80 a ton in order to make a profit.

We also have a problem in the wheat industry. What happens if we cannot sell our wheat? The marginal areas, which produce large quantities and which are subsidised by the Australian taxpayer, will create an export problem. This in turn will mean that people growing wheat on small farms and in concentrated areas will suffer, lt would be a very bad thing if we reached the stage where efficient farmers and efficient cotton growers were faced with such an export surplus as to reduce their incomes to a point where their profitability would come right down.

I am not opposed in principle to supporting an export industry, provided that we can find the markets for it. that those markets are reasonably secure and that the price obtained means that the Government or the taxpayers of the country are not required to subsidise it to any great extent. After all, it is earning much needed export income, which is probably more important to us than securing funds from overseas by other means, particularly overseas loan money which has to be repaid or capital inflow. The best overseas income we can earn is that from our own industries, because the money goes back into our own country and is spread among our own people.

However, as I have said, there is a limit to what can be done in this direction. I believe that if the Government is to give any assistance to the cotton industry - or to any primary industry, for that matter - the greatest assistance that can be given is through research. That is particularly so in respect of the cotton industry because it is a young industry. Research may not be able to achieve any great developments in our older established industries, except in certain circumstances; but in a young industry such as the cotton industry there is no doubt that it can achieve a great deal. In fact, it has done so in the few years we have had cotton growing in Australia.

Another point, which many people do not realise, is that there is no doubt that one of the main factors in the cost of production can be the areas of the holdings, particularly in these days of high mechanisation. If living areas are determined on a cost level or price level which is a world price level, that will be a sounder basis than that of an industry which has been propped up. In nearly every primary industry that has been propped up we find that land values rise. Of course, land values are one of the determining factors in costs. Therefore, if we can establish an industry properly, on the basis that it does not have to be supported, it will be able to face the problems of the future much more effectively than will an industry that has been propped up.

The wool industry and the beef industry have had their problems. In fact, the wool industry has its problems today in respect of synthetics. In the arid areas these industries also have problems of drought. But they have been able to battle their way through and to find indirect means of assistance. In the long run these are better for an industry than being propped up by a price support scheme, which can mean increased costs. Any industry that is made profitable by being propped up inevitably runs into thu ever increasing problem of disposing of its product economically on export markets.

We have areas such as the Ord River area and the Nogoa River area in Queensland. I believe that it is a mistake to think that by continuing this subsidy we will assist those areas. When a subsidy is given by a federal government it applies to everyone. A government cannot give a certain subsidy to the growers in one area and a different subsidy to the growers in another area. The subsidy must be nation-wide. If we continue a subsidy that will make the Ord River or Nogoa cotton growers just able to live at a level over the breadline - not prosperous by any means - we will create a situation in which it will be more lucrative to grow cotton in the New South Wales areas, such as the Namoi valley. Therefore, there will be increased production. Of course, the bounty will continue, and as the bounty continues we will have overproduction and will be back to the old problem of trying to sell the cotton overseas. I remind honourable senators of what is happening in the wheat industry.

I believe that the greatest help that can be given to the Ord River and Nogoa farmer is direct assistance or research. Of course, the Nogoa farmers have not started yet. When they design their farms they should take into account the prosperity of the cotton industry and make sure that research is done beforehand and that the farms are sufficiently large. Any assistance given should be in the form of indirect assistance rather than in the form of a bounty, which will encourage overproduction in other part* of Australia.

Senator Milliner:

– By whom should the research be done?

Senator MAUNSELL:

– By the Commonwealth Scientific and Industrial Research Organization, as it has been done elsewhere, and by our own departments. I have some very interesting figures on what this bounty amounts to. In 1964, when it was introduced, it amounted to 14.25 te per Jb; in 1965, 13.8c; in 1966, 8.9c: in 1967. 1 0.1c; and in 1968 5.6c. So it has been decreasing gradually, lt is estimated that it will amount to 4.9c per lb in 1969; 3.5c in 1970; and 2.3c in 1971.

As I said before, the requirement of the industry in Australia at the present time is about 132.000 bales. We will be able to supply more than that, although we will not be able to supply 1 5,000 bales of long staple cotton. I understand that 700 acres is on trial for the production of that type of cotton. 1 believe that this is a step in the right direction. If we can produce all our requirements and cut out our imports our main objective will be achieved.

I oppose the principles enunciated in the amendment. .Paragraph (a) refers to the payment of a bounty. I have explained why I am opposed to the continuation of the bounty now that we have reached full production and export potential. Paragraph (b) calls for:

  1. . an immediate review of the economic position of the raw cotton industry with the object of providing adequate financial assistance to those areas which are still in need of a bounty, and which have not yet had time to become established viable economic units, such as the Ord River and the Queensland irrigation areas.

We have had the review. As I have just explained, unless these areas can be set up in the right way or assisted through research, the mere lending of money will not help them. It is not much good lending money to any organisation or industry other than through the normal channels through which it can secure money if the organisation or industry is not profitable. By doing that you are only putting off the evil day. The mere lending of money will not help any industry that may be in trouble. The help must be given in other ways, namely, through indirect assistance or research. So. with those few remarks, I support the Bill and oppose the amendment.

Senator BULL:
New South Wales

– I support the Bill. I wish to say at the beginning that I do not pretend to be knowledgeable on many aspects of the cotton industry. My remarks are based on my observations of the industry in the Namoi Valley and on what 1 have read and have heard said of the industry in this Parliament, The cotton industry is of economic importance to Australia, particularly in areas where it has been established on sound business lines. The purpose of this legislation is to phase out payment of the bounty in the next 3 years. In the first year a bounty of S4m will be paid, in the second year $3m, and in the third year S2m. The bounty will then completely disappear.

I have entered this debate mainly because 1 find that the provisions of the Bill are entirely along the lines of my thinking as to the proper use of bounties. I hold similar views with regard to subsidies and tariffs, but in this debate we are dealing only with payment of a bounty. In considering this legislation it is necessary to consider the history of the cotton industry in Australia. It has made tremendous strides over the last few years. Until about 10 years ago the cotton industry in Australia had developed mainly in Queensland and New South Wales in areas of reasonably good rainfall. At that time irrigation was not used to any great extent in cotton growing. The construction of the Keepit Dam on the Namoi River in New South Wales and the arrival of many new settlers, particularly from the United States of America, who had a knowledge of cotton growing and brought in new capital, have caused the industry to make great progress in the last few years. In a few minutes 1 will cite figures in this regard. Between 70% and 80% of Australia’s total cotton production is grown in the Namoi Valley. Recently the industry has become better established in Queensland. 1 think I. am correct in saying that irrigation is employed in some areas of Queensland for cotton growing.

The bounty was first paid in 1964, on quality rather than on quantity. It was payable only on cotton grown for domestic use in Australia. Last year the Act was amended to provide for payment of the bounty on ali cotton grown in Australia. I believe that the Government made a wise decision to commence paying the bounty in 1964 because it allowed the industry to become established. A great deal of capital was required to set up the cotton growing industry on sound business lines. Payment of the bounty permitted the industry to employ the best scientific methods in growing different varieties of cotton. It also allowed experimentation to be conducted, which could not have been conducted otherwise. Because payment of the bounty was instituted sound business principles were adopted in establishing the industry. In 1964 cotton production in Australia totalled about 12,000 bales. In 1968 it had grown to about 150,000 bales, a figure about 45,000 bales above domestic requirements. With the concurrence of honourable senators I incorporate in Hansard the following table published in the October 1968 issue of the ‘Quarterly Review of Agricultural Economies’, issued by the Bureau of Agricultural Economics:

1 draw to the attention of honourable senators the fact that in 1968 the lint yield of 986 lb per acre was about six limes greater than the yield per acre in 1963. That increase reflects not only the growth in acreage and production, but also the increased productivity per acre, brought about largely by irrigation, scientific methods and the introduction of new varieties of cotton. Payment of the bounty was a big factor in lifting not only total production but also productivity per acre.

In the debate on this legislation in another place the Minister for Primary Industry (Mr Anthony) referred to the figures set out in the table I have incorporated in Hansard, and the economic survey conducted to obtain the figures it contains. In the survey details were obtained from 154 cotton growers in the Namoi Valley, or 75% of all cotton growers in the area. Senator O’Byrne has said that for various reasons the large Austcott organisation was excluded from the survey. The survey showed that the average net annual income of growers for the 3-year period covered by the survey was $69,767. Included in this amount was bounty of about $41,000. There is no doubt that payment of the bounty greatly helped growers to obtain a tremendous increase in net annual income. Return on capital was 9.1%, an extremely satisfactory figure judged by the return gained by other primary industries.

I remind honourable senators that the figures 1 have cited relate to the Namoi Valley. In central Queensland the position was not quite as good, but was satisfactory. The figures support my contention that the Government was justified in introducing the bounty in 1 964. It can be regarded as a good investment both for cotton growers and the Government. Senator O’Byrne said that most of the bounty comes back to the Government as income tax. 1 do not agree. I hope that the Government has not reached the stage of introducing income tax rates so high that about $41,000 income tax is paid on an annual income of about $60,000. However, there is no doubt that the bounty has been a sound investment by the Government Cotton growers in about four-fifths of the area where cotton is grown in Australia are now most prosperous. Capital expenditure has been increased and has placed the industry in a very favourable position to increase production. No doubt it will now be able to lift its production to a greater extent under its own momentum. I believe that this has been the result of a wise and proper use of bounties.

The Government has achieved the objective it sought when it fixed the bounty on cotton. I believe that the Government is quite correct in phasing out the bounty over the next 3 years. The use of the taxpayers’ money on an industry which is very prosperous cannot be justified. The phasing out of the bounty over the next 3 years indicates to the cotton industry that it will be receiving declining support from the Government over that period and gives the industry an opportunity to make its business arrangements accordingly. I have always said that once an industry receives the benefit of a bounty, tariff or subsidy it is difficult to take that benefit away from it. There are always objections to such a course. I also believe that if bounties, tariffs and subsidies are not watched carefully there is the tendency for a degree of inefficiency to occur and for some complacency to occur regarding the cost of production.

In the cotton industry in New South Wales, and perhaps to a lesser degree in Queensland, there is competition for a comparatively short supply of water. 1 am well aware that in the central west and northwest of New South Wales where a considerable amount of water has been used for the production of cotton there is great dissatisfaction among landholders in the lower reaches of the rivers which supply water for the cotton industry. For generations these landholders have felt that they were entitled to and have received a greater proportion of the water than is now available to them. But when an industry like the cotton industry can expand without assistance from the Government, I feel that some of the criticism directed at it will not be as warranted as it might have been in other circumstances.

I regret, as I think we all do, that the cotton industry on the Ord River is not proving to be a success. There are ample supplies of water in that area and it should be capable of being economically dammed. I believe that if the Ord cotton industry had been an economic proposition it would have been of great assistance to the development of the area generally. Of course, cotton is still being produced but its future is obscure to say the least. A viable cotton industry, other suitable crops, the beef industry which is already established in the area, together with the tourist trade, would have assisted in the settlement of the whole area and the development of, say, the port of Wyndham, lt is a well known fact that two people are required to service any new arrival in a locality. I have been to Kununurra. I hope that the development of that area will prove to be a profitable investment. I think it is of economic importance to Australia. We must in the future take a closer look at our north and try to bring about greater development.

The Opposition has moved an amendment to the motion for the second reading, lt appears that the Opposition will not be calling on any more of its followers to speak in support of the amendment. 1 am surprised at this. When one moves an amendment one usually seeks support for it.

The fact that the Opposition is not calling on any of its members to speak in support of the amendment is an admission that it is not strongly behind the amendment. I oppose the amendment because I do not think that it is realistic. How can the Government give further assistance to an industry which must be regarded as one of the most profitable primary industries in Australia? How can it give assistance under section 92 of the Constitution to an industry which, although it definitely is having problems in certain areas, is meeting our domestic requirements? How can the Government give assistance to an industry which would probably have difficulty exporting its surplus cotton?

I heard Senator O’Byrne mention the other day the possibility of exports to South East Asia and Japan. 1 remind him that there has been quite considerable opposition to the cotton bounty from some Australian industries, including the wool industry, because the bounty has had the effect of preventing Japan and other countries, such as India, from marketing their textiles in Australia. That was the reason for the opposition a few years ago but now that the bounty is being lifted I find no fault. I believe that the bounty must be removed so that we can have freer competition between the countries with which we trade. 1 congratulate the Government on the action that it has taken. I am confident that the industry will continue to prosper. We have an established market in Australia for the cotton that is grown at present, although we still have to import certain types of cotton for our secondary industries. I hope that the industry will expand. I will offer no opposition if it can expand under its own steam, but I am not keen on giving it further assistance. The granting of a bounty to such an industry cannot be justified. I support the motion and oppose the amendment.

Senator LAWRIE:
QUEENSLAND · CP; NCP from May 1975

– I support the motion. I am probably in a different position from that of most other speakers in that I have had considerable experience in dry land cotton growing. I have grown dry land cotton at different times over a fair number of years and I know a lot of the problems and difficulties associated with it. By dry land cotton 1 mean cotton which is not grown under irrigation.

The Bill provides for the phasing out of the cotton bounty over a period of 3 years. This is not a sudden cutting off of the bounty. The industry is given a chance to make adjustments to the conditions under which it operates at present.

The cotton industry in Australia has seen great changes over recent years. Dry land cotton has been grown intermittently in Queensland over very many years. The early 1920s saw a considerable boom in the industry in Queensland. A lot of new land was cleared. Brigalow and other types of scrub were burnt. For the first year in many cases cotton was planted, with a walking stick type of planter, in the ashes. In many cases quite considerable results were achieved and, for dry land cotton, quite good crops were harvested, although nothing like the present results, with irrigation methods, were achieved. The two developments which changed the whole industry were mechanical harvesting and irrigation. Mechanical harvesting has been a gradual development. For quite a few years now harvesters of various types have been used in Queensland, the State that I represent. The first harvesters were fairly crude and only partly effective, but they have been developed and perfected and they have made a big economic difference to the industry.

In the early years of cotton growing all the colton had to be hand picked. The cost of hand picking accounted for quite a considerable proportion of the gross value of the crop. The hand picked cotton, however, was of extremely good quality and clean, ft had no trash, leaves or other foreign matter in it. A change came with mechanical harvesting. The mechanical pickers tend to take quite a lot of bush, quite a lot of green leaves and other foreign matter. For that reason the seed cotton cannot be kept too long in its boll form. Within 2 days at the most it has to be put through the gin otherwise the foreign matter and trash in it will stain it and its value will depreciate. That problem has been overcome with fast road transport. In the afternoon semi-trailers pick up the cotton that has been harvested and overnight take it up to several hundred miles to the gins. Next morning it goes straight into the ginning machines, is cleaned up and all the foreign trash is taken out of it.

The biggest advance has been due to irrigation. The Keepit Dam on the Namoi River has been mentioned. Apparently the land in the Namoi area is extremely suitable for cotton growing. The climate is extremely suitable for irrigated cotton. Very considerable development has taken place in the Callide Valley in Queensland due to irrigation that makes use of water from underground gravel beds. The industry in that area had a setback this year owing to the extreme drought conditions. Some of the irrigation bores failed, but we hope that will be only a temporary setback and that the industry will come into its own again in the future. Irrigated cotton has given a fivefold or sixfold increase in the weight of crop per acre, as compared with dry land cotton. This increase is very substantial. Even though the cost of irrigation may be substantial, it is amply repaid and justified by the much greater yield per acre.

A new technique for irrigation had to be developed. The farmers found that they could not simply water the cotton when they thought it needed a bit of water and get a good crop. In fact, they found that by watering at the wrong time they could destroy the crop or most of it. By hard and bitter experience they have had to ascertain just when to water. They estimate at what time the bolls or squares will be forming, and they water just before they are forming, in order to achieve the full harvest and the best possible result. Results have demonstrated quite clearly that irrigating cotton at the wrong time is a waste of water. Cotton has to be irrigated at exactly the right time and with exactly the right amount of water.

In Queensland in the mid- 1920s the State Government gave a guarantee of 5id per lb of seed cotton. That had quite a stabilising effect on the industry. The guarantee continued for several years. In the light of conditions existing at that time the guarantee made the growing of cotton quite an economic proposition. The growers were faced with high harvesting costs. As I explained, all the cotton had to be picked by hand. The harvesting atone accounted for about Hd to 2d per lb out of the guaranteed price of 5£d per lb for the seed cotton. In any industry 30% to 35% for harvesting is a fairly substantial amount. In many cases the cost of harvesting cotton was a bit too much for the growing of cotton to be economic. Incidentally, the hand picking, for those who experienced it, was quite back-breaking work. At the time of the boom about which 1 am speaking, in the mid- 1920s, the ginning capacity in Queensland extended rapidly and six towns had cotton gins which could treat quite a substantial amount of cotton. After J or 2 boom years the number of cotton ginneries dropped back to two. One was at Whinstanes, near Eagle Farm Airport in Brisbane, and the other was at Rockhampton.

Later, in the 1930s, cotton harvests were somewhat intermittent. They were dependent entirely on seasonal conditions. The growers had no system of irrigation. Queensland had its Cotton Board which acquired the cotton from the growers and dealt with the spinners on behalf of the industry. That situation obtained for some considerable time - right up to the early years of World War II. In those days most of the Queensland cotton was grown in the Dawson-Callide Valley, which is adjacent to where I live. In more recent times development has taken place at Cecil Plains on the Darling Downs. The land in that area is irrigated. The growth of the industry there has been so spectacular that the ginnery which for so many years had been in use at Whinstanes in Brisbane was moved to Cecil Plains, lt is operating there now. lt is unlikely that there will be much future expansion in dry land cotton. Dry land cotton is grown to a small extent only and, generally speaking, it is uneconomic. It has to be planted in such a fashion that it can be harvested mechanically. Mechanical harvesters are used on dry land cotton as well as on irrigated cotton.

It is generally agreed that the most spectacular development in Australia has been in the Namoi area. I understand that about 80% of the total amount of bounty is paid to the growers in that area. The Ord scheme has been mentioned. Having seen the Ord area, T see no reason why cotton growing there cannot be expanded. The area could produce a lot of cotton in the future. Another way in which the bounty has benefited Australia greatly has been in the saving of foreign exchange. Four years ago cotton imports cost Australia $16m per year. For the last complete year cotton imports cost the country only $2m. One can imagine the saving in foreign exchange that has been achieved because of the bounty paid over that period. The increase in the production of the Australian crop has been spectacular. In 1964 the cotton industry throughout Australia produced 12,000’ bales. In 1968, 4 years later, production had increased to 150,000 bales. The estimate for next year is 168,000 bales. It has been mentioned already that Australian spinners require about 130,000 bales. Some of this requirement must be imported because we do not grow a suitable type of cotton. Consequently, quite an amount of Australian produced cotton has been available for export and sale overseas.

Last year it was found necessary for the Parliament to amend the Cotton Bounty Act to make it clear that the cotton bounty could be paid on export cotton as well as on locally consumed cotton for which the original Act had been designed. When the bounty was originally applied nobody envisaged that there would be such a spectacular expansion of the industry and that we would become a cotton exporting nation. As the bounty is a fixed sum each year there has already been a reduction in the amount paid to growers per lb of seed cotton because of the vastly increased production. In 1964 the bounty was more than 14c per lb; in 1965 it had gone down to 13.8c per lb; in 1966 it was 8.9c per lb; in 1967 it was back up to 1 0.1c per lb; in 1968 it was down to 5.6c per lb; and in 1969, based on the estimated production and with a ceiling of $4m on the bounty, which is in the course of being phased out, it will be down to 4.9c per lb. In 1970, with a ceiling of $3m on the bounty, the amount per lb will be down to 3.5c, and in 1971, with a ceiling of $2m, the bounty will be down to 3.2c per lb. The bounty is being phased out gradually to avoid any undue dislocation of the industry and to enable it to proceed in an orderly way.

I should like now to cite the production per acre in Australia. Yields have increased from 180 lb of seed cotton per acre in 1964 to 987 lb pex acre in 1968. The increase comes from the big irrigation areas which arc now producing. To show how the yield of 987 lb per acre compares with the yield achieved in other countries I mention that in the United States of America the yield is 511 lb per acre, in Mexico 613 lb, in Brazil 246 lb, in Russia 757 lb, in India 118 lb, and in Uganda 60 lb. Industry representatives estimate that on existing areas and under normal conditions the current upper production potential is about 180,000 acres in Australia. 1 presume that most of that would be irrigated land because, as I mentioned earlier, it is uneconomic to grow cotton on dry land. I point out also that there is no reason why the Australian cotton textile industry should not be able to seek out export markets for manufactured cotton goods and thus earn export income on a manufactured article instead of exporting raw cotton or cotton lint. Rising costs in other so-called cheap labour countries could help us in this regard.

Because of our efficiency and cheapness of production there is no reason why we cannot enter world markets and export manufactured cotton goods. Who would have believed a few years ago that Australia could export rice to the world markets, compete with other countries and build up a fairly substantial export in that product? I see no reason why we cannot do the same in cotton textiles. I believe that this is quite possible and that it should be our objective. I believe that the bounty has put the cotton industry on a sound basis and that the Government is right in starting to phase out the bounty. 1 qualify this by saying that if at some future time it is found that increased costs of production or other factors make it impossible for the industry to carry on, consideration may have to be given to the re-introduction of some form of assistance or bounty. The removal of the bounty is not final; it is being removed for the time being. I believe that the Govern ment is pursuing the right policy. I along with others, wonder why the Opposition has proposed an amendment when it has only one speaker to support the amendment. Apparently the Opposition does not have much faith in the amendment. 1 oppose the amendment and I support the Bill.

Senator WILKINSON:
Western Australia

– I do not profess to be an expert like Senator Lawrie on the production of cotton. It was not my intention to enter this debate for the simple reason that, having heard Senator O’Byrne last Thursday and again today, I thought he had covered in a very thorough fashion the area of cotton production and the need for the continuance of a subsidy for the time being. Having heard his argument, it seemed to me that the submission of an amendment by the Opposition was quite in order, that it was something that the cotton growers would appreciate and was therefore of considerable importance.I was not aware that one could hammer home the importance of a subject merely by getting a number of other speakers who could add nothing to the debate to offer their support. There is one point that I want to add to the debate.I refer to a matter which was probably inadvertently overlooked by Senator O’Byrne but which seems to me to be one of the most important factors in a consideration of whether a bounty should be continued in the way in which it has proceeded in the past.

We have just heard Senator Lawrie give a very good exposition of the situation as he sees it. I draw attention particularly to the figures which he cited. He went to some trouble to show us how the Government proposed to phase out assistance to the industry until it reached a point in 3 years’ time of being 3.2c per lb of cotton. With his knowledge of the cotton industry I was very surprised that he did not mention that the United States of America, which is probably our biggest competitor, grants an export bounty on cotton, the effect of which is the world price of cotton can be depressed by 2c or 3c per lb without affecting the United States of America. After the 3-year period of phasing out the bounty, during which time it will be reduced from 4.9c per lb this year to nil, we will be producing cotton at a price higher than that at which the product is available on the world market.

We are able to adduce arguments to show why we should assist other industries, including the dairying industry, in order that they may gain an export market and in order that they may earn credit for us overseas. It seems to me that when we produce a good quality cotton the arguments should apply also to this industry so that it may be permitted to take a fair share of the world market. We have shown that in cotton we can compete on a quality basis. Therefore we should be able to meet the product of other countries on equal financial terms. I believe that our amendment is perfectly legitimate and for the benefit of the industry as a whole.I direct attention to it again. It proposes:

Leave out all words after ‘That’ - insert the Bill be withdrawn and redrafted to provide -

for the payment of a bounty of $4m on total production of raw cotton tor the year commencing on the first day of March, One thousand nine hundred and sixty-nine;

for an immediate review’-

I think this is exactly what Senator Lawrie had in mind. He wanted an immediate review of the position. He was prepared to go along with the suggestion that the determination reached by the Government could be varied. Our amendment goes on:

  1. for an immediate review of the economic position of the raw cotton industry with the object of providing adequate financial assistance to those areas which are still in need of a bounty, and which have not yet had time to become established viable economic units, such as the Ord River and the Queensland irrigation areas’.

It is well known, as has been stated already in the debate, that some of the older established areas which go back a considerable time are quite solid financial and viable propositions. The amendment continues:

  1. that special financial payments to assist the developing areas to become established viable economic units be implemented within section 96 of the Constitution’.

It seems to me that the arguments which have been put forward are perfectly valid. I have pleasure in supporting the suggestions contained in our amendment and I hope that on consideration those honourable senators, such as Senator Lawrie, who are really concerned about the industry will be prepared to support us.

Senator SIM:
Western Australia

– I always believed when the bounty was granted that it was intended to encourage the production of cotton in Australia to meet our own requirements and that when those requirements were met the bounty would be phased out. I think it was Mr Oliver, a research agricultural economist with the Department of Agriculture in Perth, who commented several years ago that the best type of bounty was the bounty which encouraged production and which when production had been encouraged was phased out. Such a procedure ensuresthat an industry is soundly and economically based. I did not intend to speak to this Bill until I heard, 1 am bound to say, the rather ill-considered comments of Senator O’Byrne If I can understand the Opposition’s case, it favours a continued increase in cotton production in Australia regardless of the economics with the main object of exporting to the markets of South East Asia or Asia and Japan. Senator 0’Byrne accused the Government of being very shortsighted and then went on to say:

After al), trade is the lifeblood of any nation. We are fortunate to have a commodity-

That is cotton - which will always be in demand on tha world market and particularly on the Asian market.

Having heard that statement my mind went back to the advice I heard given in Rome by the cotton experts of the Food and Agriculture Organisation who said that they strongly discouraged any further increase in cotton production in the world because of the difficulty of markets and the downward pressure on prices. If this be so, I suggest with great respect to my friend Senator O’ Byrne that he is taking a shortsighted attitude. It is all right to talk glibly about markets but you must have an understanding of the world situation.

Before dealing with the market situation in the world 1 want to deal with one other aspect of Senator O’Byrne’s submission. The Australian Labor Party has always claimed that the problems of Asia are the problems of economic welfare. It says: ‘We must build up the economies of Asian countries’. Yet here we have the Labor Party advocating that Australia should subsidise cotton production and then compete with the developing countries of Asia, South America and the Middle East on world markets that already are under great pressure from both production and a fall in consumption. All we would do would be to create more difficult world market situations against the exports of the less developed countries.

I have with me the report of the Food and Agriculture Organisation on cotton. I think we should well understand the views of the Organisation. When summarising the cotton situation it pointed out that in 1967 there was a slight increase in cotton prices and that the developing countries increased their earnings from cotton exports by 10%.

That, of course, was important to those countries. They increased their export earnings to $US1,500m. In addition, they were estimated to have earned between $US7l5m and $US720m from the export of colton manufactures. We can see from those figures that cotton exports play a major part in the export trade of the developing countries. Yet we are being asked to compete against those countries on the world market. That would be all right if the world market was buoyant. That would be all right if the markets in South East Asia and elsewhere were buoyant and capable of great expansion, but that is just not so. The report of the Food and Agriculture Organisation goes on:

Production in the United States is expected to rise considerably in 1958-69 but smaller rises are anticipated in developing countries . . . Consumption seems less likely to increase, however, in view of reduced economic activity and more severe competition from synthetic fibres in developed countries. Little change is anticipated in the volume of international trade in 1968. Pressure on prices may continue as competition from synthetics in most consuming countries becomes more intensive, particularly if cotton supplies increase.

Sitting suspended from 5.45 to 8 p.m. (General Business Taking Precedence nf Government Business)

page 946

EXPORT OF MERINO SHEEP

Senator POYSER:
Victoria

– Pursuant to notice in the name of Senator Murphy, and on his behalf, I move:

That the Senate is of opinion that the embargo on the export of merinos should not be removed at this lime. 1 seek leave of the Senate to amend the motion by adding the words: and that the embargo should remain in force until a majority of those persons affected shall decide by referendum or other fair means in favour of removing or relaxing the embargo.

The PRESIDENT:

– There being no objection, leave is granted.

Senator POYSER:

– The Opposition moves this motion for three reasons. The first is that it has not been established that the lifting of this ban is in the best interests of Australia. The second is that the recommendation made by the Australian Wool Industry Council to the Government did not fully represent the views of ail growers in this country. The third is that the decision has been made without adequate consultation with the growers concerned. We believe that this ban, which was introduced in 1929, has served Australia very well. On the 27th November of that year, at the request of the growers of this country and many other sections of the community, the then Minister for Markets and Transport proclaimed a ban on the export of merino rams from this country. In the debate on this subject he made a number of very interesting points as to the reasons why the Government and the Cabinet in particular had decided to implement the ban. I should like to quote briefly some of the reasons he submitted. In his opening remarks, the Minister said: in compliance with the promise that I made this afternoon, 1 now inform honourable members that a proclamation under the Customs Act has been issued requiring the consent of the Minister for Trade and Customs to be obtained before stud sheep are exported from the Commonwealth.

In the course of the debate, he claimed that this was in the interests of Australia. Later on in the debate he said:

During the last 4 weeks 1 have been inundated by correspondence from all parts of Australia, 1 have received numerous deputations, and I have interviewed many individuals. At least nine-tenths of the persons with whom 1 have been in touch have expressed themselves in favour of some control over the export of stud sheep. A small section of those who have written to me have expressed the view that action in the direction of imposing an embargo - a term that is not applicable to this action - ought to have been taken years ago.

This was the feeling of the industry at that time. I have every reason to believe that many in the industry still feel1 that way. 1 know that many arguments have been submitted by the supporters of the lifting of the embargo that may sound reasonable to those who listen but do not think too deeply about what is involved. I. understand that if we do lift the embargo the number of rams that will be exported in the first year will be only 300. lt is argued that the main reason for the lifting of the embargo is that it will1 lead to an improvement in the quality of wool in other countries and may lead to an increase in the use of wool. In my view, whether this will happen is a real gamble. The argument that it will lead to the increased use of wool does not stand up to examination when one thinks about it thoroughly because at the present time even though it may lead to an improvement in the quality of the wool most wool producing countries in the world will not be able to increase their flocks to any great degree. The information we have been able to gather leads us to understand that the pastures in most of these other countries are almost fully used at the moment and the only real prospect of any great increase in wool ties in the development of the industry in this country on a far larger scale than exists at the present time.

This is not going to be easy to do, and it will probably require a long term programme. We also believe that the lifting of the quality of wools in other countries would equally require a long term programme. I think that the real reason why the embargo is sought to be lifted is the fear of synthetic fibres, lt is common knowledge to all honourable senators who examine the question of the use of synthetic fibres that the increased use of these fibres is gradually getting to the stage where the percentage of wool being used is dropping reasonably rapidly. But it is still a fact that, in terms of poundage, the use of wool throughout the world is increasing annually. So the situation cannot be envisaged where industry will in fact stop using wool as an apparel fibre. Therefore, the arguments that are put up in favour of lifting the embargo seem to establish that the lifting is at best only a gamble that may not come off. Indeed, we may find ourselves in the position of selling our heritage, as was suggested during the debate in 1929.

The statement that the vast majority of woolgrowers of this country are in favour of lifting the embargo is not borne out by the facts. We know that in recent days petitions have been submitted in both Houses of this Parliament by between 2,000 and 3,000 persons seeking at least a referendum before the proposed action is taken. The reason why the referendum is sought is that the growers believe they were not properly consulted before the decision to lift the embargo was arrived at. lt may be said by some that the Australian Wool Industry Council is the parliament of the wool industry. I want to say here and now that although I would not like to see the AWIC abolished I do reject the argument that it is the parliament of the wool industry. I reject that suggestion entirely because, in my view, and in the view of many people associated with the industry, including some of the persons who sit on that Council, the Council as at present constituted is not representative of the growers of this country and is in fact an undemocratic setup.

We in this country pride ourselves on the fact that our parliaments are democratically elected by the people. Until such time as the AWIC examines the position and is reconstituted in consultation with those who believe it should be reconstituted and becomes a body that is democratically elected I do not think we can take full cognisance of the matters it wants to place before this Parliament. We now have a state of affairs where organisations have grown up like mushrooms - J think that would be the correct word - in most States of Australia the moment it became known that the Government had decided to lift this embargo. This was the reaction amongst the woolgrowers of Victoria in particular. I know it is also the reaction in New South Wales and the move is now snowballing into very real opposition to the Government’s proposed action. The growers believe that the Government is taking arbitrary action without giving any real thought to the matter. We believe that until such time as the wool industry can speak democratically for the growers this embargo should not be lifted. We most certainly feel that the embargo should not be lifted until there is a referendum of the growers or until some other action is taken which will satisfy the growers that the real opinion of the woolgrowing industry is being obtained.

Senator Webster:

– Who should have a vote?

Senator POYSER:

– That is something that will be examined by the people concerned. This is clearly a job for the Australian Wool Industry Conference and those who are protesting at this time. I hope to see Senator Webster vote in favour of this resolution. On many occasions in this chamber we of the Opposition have heard Government supporters say that senators should work on the basis that they represent the States in this Parliament. The States are the ones of whom we should take note. The Victorian Senate representatives are in a very peculiar situation because the Victorian State Government has quite clearly declared itself in opposition to the lifting of the embargo.

A Press statement was released recently by the Victorian Minister of Agriculture, the Hon. G. L. Chandler. His signature appears on a document which I have received directly from him and I think it should be put on the record, lt reads:

The Victorian Minister of Agriculture, the Hon. G. L. Chandler, C.M.G., M.L.C., said today that his Government disagreed with the lifting of the embargo on the export of Merino rams. The embargo was imposed in 1929 and its lifting has just been announced by the Commonwealth Government.

The Victorian Government believes that there arc strong reasons for opposing the sale of Merino rums lo our overseas competitors and it is aware that it is not the only State government with this altitude.

Whatever may have been said to the contrary, competition from overseas buyers for Merino rams will tend to raise the prices, reduce the numbers and lower the standard of rams available to Australian wool growers, in the short term at least.

Commercial wool growers will receive no advantage from raising the embargo unless wool prices actually improve as a result.

Without stringent controls, there is a risk ma valuable sheep may be lost to this country. Effective controls will be difficult to implement and may eventually create more ill-will in overseas countries than does the present blanket embargo.

While there may be «une financial advantage to the exporters of rams, this will only be a1 the expense of the industry al large.

This statement was not made by an honourable senator on this side of the chamber. I read it in full because most of the Pres3 reports I read took only extracts from the statement that the Minister had given.

Senator Webster:

– Are you not going to tell us-

Senator POYSER:

– I suggest, Mr President, that Senator Webster will be able to make a speech on this subject and salve his conscience in regard to the Party that sends him here. Senator Webster has to be extremely careful about what he does. If he does not toe the line he will not get an endorsement in the Liberal team. He has come to this chamber on a number of occasions and spoken against the Government’s activities but then immediately voted in favour of them. 1 prefer to ignore the remarks he makes from the side because he is a man of convenience and not conviction.

Senator Webster:

– J thought you would tell us to whom you would give the vote.

Senator POYSER:

– I would not give it to you. The position, as we on this side of the chamber see it. is that this lifting of the embargo is a very risky venture which does not have the full support of those in the industry.

I do not intend to speak for very long tonight. We shall put honourable senators opposite to the lest. We have until 10.30 p.m. to deal with this subject. We on this side of the chamber hope to put our points concisely so that honourable senators on the Government side have the opportunity to speak and vote before 10.30 p.m. They should let us see where they stand on this matter. We believe this subject is so important that it should not be talked out. if honourable senators on the Government side think that this subject is not important enough to warrant a vote being taken, they can stonewall until 10.30 p.m. as they have done on many other occasions, and not permit a vote to be taken. My colleague from Western Australia will amplify, later on, the points that I have made. I conclude by saying that we believe that a referendum should be the method of making a final decision on this matter. There is much evidence to show that the decision to lift the embargo was conceived in haste without clear thinking and is not in the interests nf the wool growers or Australia in general.

Senator McKELLAR:
Minister for Repatriation · New South Wales · CP

– Firstly, I would like to express my amazement that the Leader of the Opposition (Senator Murphy) gave notice of this motion in the first place and that Senator Poyser then amended it. It also amazes me that the Opposition should call on a former secretary of the Geelong Trades Hall Council and an assistant secretary of the Victorian Branch of the Australian Labor Party to propose the motion. This seems to me to be symptomatic of the paucity of the people on the Opposition side able to express an opinion on a matter affecting primary production in Australia.

Senator Murphy:

– lt affects every Australian.

Senator McKELLAR:

– I know it does.

Senator Keeffe:

– You pull the wool over somebody else’s eyes.

Senator McKELLAR:

– You probably will have a chance to talk later on. This is not the first time that the Government has been in such a position. The reason for this, of course, is that it is bedevilled by the fact that the wool growers of Australia cannot make up their minds about what they want.

Senator Cavanagh:

– Give them a referendum.

Senator McKELLAR:

– I will deal wilh you later on. We have a representative and responsible body which is supposed to represent the wool industry. It has been referred to on many occasions as the parliament of the wool industry. That organisation - and I am referring to the Australian Wool Industry Conference - made a decision and asked the Government to do something. No sooner was that decision made by that body than wc received protests about it, mainly from New South Wales but some from other States as well. How on earth can any government set out to do something for an industry when there is such dislocation of thought in the industry itself?

Senator Cavanagh:

– Give them a referendum.

Senator McKELLAR:

– Perhaps that is a cracked record that 1 can hear - I do not know. There is some reason, of course, for this independence of thought amongst not only the wool growers of Australia but primary producers generally. One reason is the very nature of their occupation. They have to rely on the weather and overseas prices. They have to rely on themselves nine times out of ten. These things do tend to bring about this independence and this is reflected, I think, once again on this occasion. This is one of the difficulties in which the Government finds itself. Of which body is the Government to take notice? ls it to take notice of the different graziers’ associations or similar bodies in each State or is it to take note of this federal body set up by the wool growers themselves? Let us look at the composition of the Australian Wool Industry Conference.

Senator Cavanagh:

– Give them a referendum.

Senator McKELLAR:

– That is the third time you have said that. Let us look at the composition of the Conference. It comprises 25 members from the Australian Woolgrowers and Graziers Council. 25 members from the Australian Wool and Meat Producers Union, 5 members from the Australian Primary Producers Union and an independent chairman who is elected by those whom I have mentioned. It has a total membership of 56. The Government looks to this body for an expression of opinion on matters affecting the wool industry.

I propose to give a brief history of the embargo leading up to this particular issue. From that history we will see that the embargo was not an idea thought up by the Government or by a small section of wool growers, lt was thought up and has been debated over the years. The decision by the AWIC to lift the embargo was not made lightly, as I will show honourable senators. It appears that objections to the limited relaxation - and that is all it is - of the Merino export embargo stem from a failure to understand the basic facts involved. These facts were stated by the Minister for Primary Industry (Mr Anthony) when he announced the Government’s decision to accept the recommendation of the AWIC for a partial lifting of the embargo.

The embargo was imposed in 1929 when a proclamation was issued under the Customs Act prohibiting the export of any stud sheep without the written consent of the Minister for Trade and Customs. In 1930 Corriedales, Polwarths and other nonMerino breeds were excluded from the scope of the ban on the basis that these sheep were readily obtained elsewhere. In the mid- 193 0s the embargo was extended to all merino breeding sheep; that is, not only stud animals. In 1950 merino semen was included in the embargo. The export of merinos to New Zealand has always been permitted, but by agreement with the New Zealand Government the re-export of merino sheep and semen from that country has been and is prohibited.

The embargo has been a controversial issue since its imposition in 1929. At various stages associations of stud sheep breeders, as well as some wool grower organisations, have requested the removal of the embargo. I recall that at conferences of primary producer organisations in New South Wales over the years on some occasions there would be a pretty strong vote for lifting the embargo and on other occasions there would be a small vote for it. The vote seesawed over the years. But in the last few months it really looked as if the wool growers of Australia had decided that in their own interests and the interests of Australia there should be a partial lifting of the embargo.

In 1951 the question of lifting the embargo was considered by the Australian Agricultural Council, which resolved that the embargo should be relaxed at the discretion of the Commonwealth Government on the understanding that the Commonwealth would not agree to unrestricted export. Then the matter was left in abeyance for some years because of a continuing division of opinion among and within wool grower organisations. In July 1962, with the impending formation of the Australian Wool Industry Conference as the national body to speak for wool growers, the Australian Agricultural Council resolved that the question, of relaxing the embargo be referred, to the industry through the Conference for consideration. That was the resolution of. the Australian Agricultural Council, on which, of course, Victoria is represented along with the other States.

Due to the preoccupation of the Australian Wool Industry Conference with wool marketing, the Conference did not commence considering the embargo issue in depth until June 1967, after having received a comprehensive paper prepared by the Australian Wool Board on the subject, as well as other expert opinion. AH of this material was distributed to member organisations of the Conference for consideration. After considering the comments and suggestions submitted by member organisations and debating the matter at length, the Wool Industry Conference decided, at its meeting in November last year, to recommend to the Government a partial lifting of the embargo. This decision was made in a resolution carried not by a small majority but by 37 votes to 16; that is, by a majority of 70%.

Over the years numerous arguments have been put forward for and against the removal of the merino export embargo. I think I had better give members of the Opposition a little help here, because they do not seem lo be making much of a fist of their case. 1 propose to give some of the reasons why some people are opposed to the relaxation of the embargo. The first one is that the growing competition from synthetic fibres - a factor that did not apply when the embargo was imposed - makes it essential that both the quality and the availability of apparel wool should be improved on a worldwide basis, because otherwise wool’s place could be taken by these other fibres. In many cases it has been; this has already occurred to some extent.

The second reason is that the world demand for textile fibres is expanding faster than wool production and wool’s share of the world fibre market is diminishing. There is a clanger, therefore, that wool will become an insignificant raw material as compared with other textile fibres, with the result that textile manufacturers will take little account of wool in planning their production. Relaxing the embargo should help to counteract this trend by assisting to increase world production of good quality apparel wool. Removal of the embargo should create good will for Australia in overseas countries and assist in improving trade relations - something of which we in Australia are badly in need.

In this respect it is important to note that other countries, such as South Africa, the United States of America and the Soviet Union, freely permit the export of their merino breeding sheep. I was talking to a man in Sydney only a few days ago. He has travelled extensively overseas and has been interested in wool for very many years. He said that the question people are asking overseas is: ‘What diseases have your sheep in Australia got that you refuse to export them?’ Surely even the Opposition will recognise that it is most important that the quality of our merino sheep here in Australia should be maintained. If we do anything that will impair the ability of the studs to maintain the quality of the merino sheep in Australia, we will suffer. As one who knows something about this subject, I can assure the Senate that there is very little money to be made out of breeding stud merino sheep today, despite the conception held in many quarters that immediately a man becomes a merino stud sheep breeder he is on the way to making a fortune. That is a fallacy.

Senator O’Byrne:

– You want to cash in at the expense of the ordinary wool growers.

Senator McKELLAR:

– You do not understand the subject; so you had better keep quiet. Let me state now the chief arguments advanced by those who wish to see the embargo retained. The first is that the export of merino rams might tend to increase competition for rams in Australia generally and particularly raise the cost of flock rams, especially to small farmers and soldier settlers. This is at the nub of a lot of the argument that is raised, lt is said that this action will damage the wool industry. If many of these people spoke the truth they would say that the reason why they do not want the embargo partially lifted is that they have this fear - I believe that it is unfounded - that they will have to pay more for their rams. I propose to point out to the Senate as I go along that the export of the 300 rams - they would not be flock rams; they would naturally be high quality rams - that will be permitted will not affect the price to be paid. No doubt it would affect the price that stud rams would be bringing; but, after all, the. number is only 300. Eventually, of course, the stud sheep breeders themselves would benefit.

The second argument is that the competition from overseas purchasers could increase the cost of high class ranis to Australian buyers. That is what I have just been saying. Thirdly, the importation of Australian merino rams by overseas countries would result in an increase in the world supply of merino wool which would, in turn, depress the price of this wool. As I have said quite a number of times during the last 12 or 18 months, 1 am one of those who believe that perhaps within the next 10 years we in Australia could find ourselves in the position of not growing enough medium to fine merino wool. I firmly believe that. I do not know whether I wil, be proved right or wrong, but that is my belief. The fourth argument advanced by those who wish to see the embargo retained is that it would be better for Australia not to export its best merino strains but to keep them and expand its own production of good merino wool and thus meet the present worldwide shortage of such wool. I think 1 have dealt with that.

Referring again to the first and second objections, it is apparent that overseas buyers would be interested mainly in high class animals and not in flock rams. There is an adequate surplus of rams of all grades already available each year to supply both the home market and the proposed export quota of 300 rams without any reduction in quality. Let me give some figures. At 30th December 1967, which is the latest date for which statistics are available, according to the Australian Stud Merino Flock Register there were 1,835 registered merino studs in Australia. During 1967 these studs sold 202,000 rams and at the end of December 1967 they still had on hand 295,000 rams; that is, only about 40% of rams available for sale were sold in 1967. The rams on hand comprised sheep of all grades: that is fine, medium and broad merino, which included rams for stud purposes and flock purposes. Surely this clearly indicates the existence of an ample supply from which rams for export could be drawn without affecting domestic requirements.

According to expert opinion the total of about 295,000 rams on hand would include a sizeable number of animals of a class likely to be in demand for export. Potentially all merino studs could further extend their output if need be, as illustrated by the fact that at 31st December 1967 the studs had on hand about 1,500,000 breeding ewes. In addition the studs held about 433,000 ram lambs and about 483,000 ewe lambs. It is reported that all studs are able rapidly to expand production should the demand warrant it and without any drop in overall quality. Stud sizes are now limited by the present demand. I do not know what the position is in States other than New South Wales, but in New South Wales during the last 12 or 18 months established stud properties have been offered for sale without attracting any buyers.

Senator Murphy:

– Why will 300 rams make such a difference?

Senator McKELLAR:

– That interjection shows clearly that the honourable senator does not understand the position. The third objection appears to be of doubtful validity for several reasons. Due to environmental factors in overseas countries the limitation on the number of rams exported and the length of time necessary to improve the quality of flocks by the use of better rams - it is necessary to be a sheep breeder to understand this point - any increase in the production of good merino wool in other countries would be gradual. Because of the increasing world population and the improvement of living standards the total market for wool and wool-type fibres is expanding much more rapidly than the rate of increase in world wool, production. Twenty years ago wool held 13.5% of the world textile fibre market. Today it holds barely 8%.

The growth rate in world apparel wool production has been about 0.7% per annum, while the growth rate of synthetic fibres has been about 12.7% per annum. The high levels of annual production of man-made fibres are significant. Production of about 13,600 million lb in 1967 was about four times as great as wool production and more than one-half of the volume of cotton production. These facts clearly indicate that synthetic fibres are filling the gap in the demand for wool-type fibres which wool itself has been unable to meet. If this trend continues the stage could well bc reached where wool would play an insignificant role in the planning, production and investment policies of textile manufacturers. These manufacturers have repeatedly indicated that in the absence of adequate supplies of good quality wool they have no alternative but to turn to synthetic fibres. The International Woo] Secretariat advocates increased production of good quality wool because it is difficult for it to influence manufacturers to use more wool if the wool is not available in the requisite quantity and quality. It is therefore clear that anything that can be done to increase the world availability of good quality wool is in the interests of Australian wool growers, lt is in the interests of Australian wool growers, it is in the interests of the Australian people.

The fourth objection appears to overlook the fact that Australia alone, because of physical limits to its production capacity, seasonal variations and general environmental conditions, is unlikely to be able to meet the future world demand for good quality merino wool. Further, it is most desirable to lift the standard of merino wool throughout the world to place it in a better position to compete with synthetic fibres.

It has been claimed that stud sheep breeders are urging the relaxation of the embargo for selfish reasons, without regard to the future of the Australian merino wool growing industry. This claim is hard to believe, having regard to the fact that the fortunes of stud sheep breeders are inextricably bound up with the prosperity of the Australian merino wool growing industry. The stud sheep breeders will be able to sell only a small proportion of their output on overseas markets and will always have to rely on the local market for the great bulk of their sales. I remind honourable senators that the rams must be offered at auction in Australia before they may be exported. In the circumstances it is inconceivable that stud breeders would be oblivious of the interest of the Australian industry on which their own future depends. They would hardly be stupid enough to cut their own throats, as it were. Similarly, the claim that stud sheep breeders will sell their top class animals to overseas interests completely ignores the fact that no breeder would sell his top breeding stock if he wished to remain in business. 1 read today some figures showing that the cost of sending a ram on an aircraft to South America is about $1,000. The air freight cost of sending a ram to South Africa is about $500. This must be added to the purchase price of the rams. Even if buyers had an opportunity to buy unlimited numbers of rams, the cost of transporting them overseas would be in itself a deterrent.

A lot has been said about a referendum. Honourable senators opposite ask: ‘Why do we not have a referendum?’ Of course, the original motion has been amended to that effect. I will state some of the reasons why a referendum is not considered necessary. No referendum was held before the embargo was Imposed in 1929, although not all wool growers supported the measure at that time. Only a limited relaxation of the embargo is contemplated. It is not sought to lift the embargo entirely. It is to be only a partial relaxation. The relaxation will be subject to stringent conditions designed to safeguard the interests of Australian wool growers. It is proposed that the relaxation and the conditions attached to it will be reviewed annually, which means that modifications or even a reversion to a complete ban could be sought by the Australian Wool Industry Conference after the first 12 months. It is only a trial period of 12 months, in the initial stage. In the circumstances there would be little merit in holding a referendum on proposals that are open to subsequent modification or withdrawal. Would honourable senators opposite press for another referendum in 12 months time, and then another one 12 months later? The idea is stupid. The decision of the Australian Wool Industry Conference was carried by a reasonably large majority of 37 votes to 16, or 70% of those persons present, as 1 said earlier.

Before the AWIC voted on the embargo it went to considerable pains to secure authoritative information and views on all aspects of the embargo. The decision was not made after only a couple of hours of debate. This material was circulated to wool growers’ organisations throughout Australia for consideration. Subsequently the views and suggestions of those organisations were considered by the Conference. Yet some people are saying that the decision was thrust on wool growers without any prior notice. What arrant nonsense some people talk. In the circumstances it is fair to say that the AWIC vote reflects the considered view of a reasonable cross-section of wool growers.

Even if a case existed for holding a referendum on this matter there would be a considerable number of practical and technical difficulties in arranging such a referendum. I will point out some of those difficulties. In respect of any referendum the question of voting qualifications must be determined. These could be very difficult to determine for any referendum on the merino embargo. For instance, the question arises whether all wool growers should be entitled to vote, irrespective of the breeds of sheep they raise, or whether the entitlement should be confined to those who produce only or principally merino wool. Some wool growers produce merino wool exclusively. Others produce merino as well as crossbred wool, while still others produce wool exclusively from non-merino breeds such as Border Leicester, Southdown, Corriedale and so on. There is also the case of producers for whom wool is a secondary consideration, for example, fat lamb raisers.

If the entitlement were confined to growers who produce exclusively or principally merino wool, it would be virtually impossible to verify the voting qualifications of those growers. Do honourable senators opposite still think a referendum should be conducted? As complete records are not available, great reliance would have to be placed on the word of growers, particularly those who sold outside the auction system - and there is quite a number of such growers. Moreover, it would be difficult, even for wool selling brokers, to provide the detailed information needed to check on the clip composition of individual growers. Of course, these complications did not arise in the 1951 and 1965 referendums on the reserve price scheme as all wool producers, irrespective of the breed of sheep, had a direct interest in the proposals. These are the reasons why a referendum is simply out of the question.

After carefully considering the recommendations of the Australian Wool Industry Conference, the Government agreed to adopt the course of action recommended by the Conference. The Conference has already been referred to on several occasions as the parliament of the wool industry. The Government considered that the Conference, as the national body of Australian wool growers, was well qualified to judge whether a relaxation of the merino embargo would be in the best interests of wool and thus of the Australian wool growing industry. It also noted that both the Commonwealth Scientific and Industrial Research Organisation and the International Wool Secretariat support the removal of the embargo. The Government considers that the ceiling placed on the number of rams to be exported, together with the other stringent conditions recommended by the Conference and the provision for annua! review of the limited relaxation, will act as adequate safeguards for the Australian wool growers. It is also evident that in recommending these safeguards the Australian Wool Industry Conference did not make its decision lightly and had proper regard for the wellbeing of the Australian merino wool growing industry.

Those are the facts and those are the reasons why the Government took the decision it did to lift the embargo on the export of merino rams. As I said earlier, it did so at the request of the Australian Wool Industry Conference and of the Australian Agricultural Council, which made its request quite a number of years ago. I hold in my hand the telegrams received today by the Minister for Primary Industry supporting the partial relaxation of the embargo that has been in existence since 1929. The Government would be failing in its duty if it did not take notice of the views of the body which has been set up to speak for the wool industry. Of whom is the Government to take notice if it does not take notice of that body? No matter what decision is made regarding the wool industry there will always be somebody opposing that decision. That seems to be the very nature of wool growers. I was a wool grower for quite a number of years and 1 have two sons who are now growing wool, so I know something about the industry. The Australian Woolgrowers and Graziers Council fully supports the Government’s decision to relax the ban on the export of merino rams. In a statement, issued on 21st March 1969, the Chairman of the Council said:

  1. . the Government’s decision which was announced in Canberra on Thursday by the Minister for Primary Industry,’ Mr’ J: D. Anthony, was completely in accord’- wilh the Council’s policy.

Here we have the ex-President of the New South Wales Graziers Association, who is now President of the Australian Woolgrowers and Graziers Council, speaking in support of the Government’s decision. He went on to say:

The Council considers that any action that can be taken to lift the standards of world wool production will help to close such inroads as synthetic fibres have made into wool’s traditional markets.

However, the Council does not believe thai the production of better quality wool in overseas countries could possibly proceed at such a rate as to pose a threat to Australia’s interests. lt has been said to me: ‘The Government is allowing only 300 rams to be exported, but what about the use of the semen of those rams to inseminate ewes overseas?’ 1 remind honourable senators that there has to be some knowledge of the industry before this can be done. It is not as simple as some people think. There is to be a trial relaxation of the ban for 12 months If things do not go as well as the Government, the Australian Wool Industry Conference and the wool growers expect, another look will be had at the matter. The decision could be changed or an alteration could be made in the partial lifting of the embargo. I repeat that in my view the Government had no option but to act as it did. I hope that as a result of this debate those honourable senators opposite who do not seem to know very much about the subject will be better informed and will vote with the Government.

Senator WILKINSON:
Western Australia

– We have just listened to the Minister for Repatriation (Senator McKellar), who is the chief Government spokesman on the motion moved by the Opposition. The Minister drew attention to the fact that the chief spokesman on this side of the House, Senator Poyser, did not own one sheep. But he has the rural interests of the State of Victoria very much at heart. He is the secretary of the Opposition’s rural committee. Senator Poyser has not spared himself to any degree in going around and finding but the problems of the primary producers, not only in his own State but also in the other States. He has a keen interest in this subject. It is very interesting to note in passing that the Minister for Repatriation, the chief Government spokesman and the acknowledged authority on the subject, read three-quarters of his speech from notes he had prepared.

Senator Marriott:

– At least he read the truth.

Senator WILKINSON:

– That is no excuse. One could also tell the truth without having to read it. That is what I will try to do in the few moments at my disposal. When a statement was first made by the Minister for Primary Industry (Mr Anthony) on the subject, I was very interested in what he was putting forward. The Minister for Primary Industry put forward three major reasons why the ban should be lifted. The other speakers in the debate in the other place, regardless of whether they were speaking for or against the proposal, repeatedly referred to the same three reasons. The Minister for Repatriation did not dwell very long on the reasons supporting the ban; he dealt mainly with the reasons supporting the lifting of the ban.

Three main reasons have been consistently advocated for lifting the ban. One is that the lifing of the ban will increase the amount of good quality merino wool on the world market. Another is that it will produce an increased demand for good quality wool, lt is said that this will improve the wool industry in Australia. Coming from a person who believes in private enterprise, as does the Minister for Primary Industry, all this seems to be quite contrary to any of the accepted ideas of the law of supply and demand. The economist’s view of what happens when the volume of the product is increased is that the price goes down. So, by increasing the supply of fine wool we would be reducing the return to Australia. It seems to me that it is an extremely risky procedure to adopt to endeavour to increase the amount of wool in the world market by providing other countries with the opportunity to compete with us. I am all in favour of increasing our own output of fine quality wool, but the Government intends to give other countries such as Russia and South Africa the opportunity to produce quality wool at a lower price than that at which we can produce it. We would force ourselves out of the market. What Mr Anthony put forward as one of the major reasons for the lifting of the embargo just does not count as a major reason.

Let us consider why the Government jumped into this situation of endeavouring to relax the ban. I consider that it is only endeavouring to relax it. I think that tonight we will have the opportunity to stop the relaxation. According to Mr Anthony, the relaxation of the ban was recommended to the Government by the Australian Wool Industry Conference, by the Australian Wool Board, by the International Wool Secretariat and by the Commonwealth Scientific and Industrial Research Organization. The recommendations made by those bodies were put forward by Mr Anthony as one of the main reasons why the Government wishes to lift the embargo.

Senator Young:

– Does not the honourable senator consider them to be responsible bodies?

Senator WILKINSON:

– The only responsible body I see in the group I mentioned is the CSIRO. I propose to tell Senator Young why I do not consider the other bodies are bodies responsible to the majority of Australian wool growers. In this case the only one to which I give credence is the CSIRO, because I think it endeavours to be factual. A report of a statement made some years ago by Sir Ian Clunies-Ross was produced. Some CSIRO scientists had studied this report and thought that it was a good statement. The statement has been referred to again. I want to study the composition of the AWIC, the AWB and the International Wool Secretariat. For a start, the AWIC is a voluntary body consisting of fifty-six members.

Senator Young:

– It has fifty-five.

Senator WILKINSON:

– The honourable senator knows that there are fifty-six members. He forgot the chairman, who makes fifty-six. Twenty-five members are appointed from the Australian Wool Growers and Graziers Council - to which no objection is raised - twenty-five members are appointed by the Australian Wool and Meat Producers Federation and a few years ago - this was not the case at the beginning - five members from the Australian Primary Producers Association were included. With the chairman, that makes the total of fifty-six. These bodies are not representative of wool growers solely; they are representative of other branches of primary industry also.

Senator Young:

– The honourable senator should be careful. He might go for a drive in the country one day.

Senator WILKINSON:

– I live in the country. The members of the AWIC are representatives of particular organisations. It has been said that the Australian Wool Growers and Graziers Council was one of the main bodies pushing for the lifting of the ban. Let us see how it fits into the picture. What is the relationship of the Australian Wool Industry Council to the Australian Wool Board? The relevant Act is the Wool Industry Act. A study of that Act shows that the Board shall consist of eleven members. Firstly, for Senator Young’s benefit, there is the chairman. There are six members representing the Australian wool growers. That sounds fine, but these six members, if we look at another section of the Act, are appointed to represent Australian wool growers upon the nomination of the Australian Wool Industry Conference. We are back again to the Wool Industry Conference, not to the wool growers. Six members of the Board are appointed by the Conference, which is a group that does not represent all the wool growers in Australia. We go further and find that on the Board one member represents the Commonwealth. This nominee is selected by the Minister for Primary Industry. The board has three other members, who are not necessarily experts in wool. They bring a kind of objective approach. They could be scientists or people concerned in marketing or producing. But let us study the actual position. The position is that these people are appointed from a list of not fewer than five qualified persons submitted to the Minister by the Australian Wool Industry Conference. We are back again to the Wool Industry Conference.

Let us look at the composition of the International Wool Secretariat which strongly recommended that the ban should be lifted. The International Wool Secretariat has twelve members. Australia has the most representatives; it has six members. New Zealand has three and South Africa has three. Australia’s six members are appointed by the Australian Wool Board. Who appoints the Australian Wool Board? In the main, the Australian Wool Industry Conference, which is one of the biggest groups in the Australian wool industry, appoints the Board. Twenty-five members of the Conference come from the Australian Wool Growers and Graziers Council. In effect they could have appointed the members of the Board. When one sees the set-up in the AWIC one can see how there could have been a block of thirty-seven votes in one corner and a block of sixteen in another corner, or it could have been thirty-six and seventeen. One also notices that some of the members of the Council did not vote; all were not present. I think that all T have stated points to a very bad situation that the Government is trying to impose on the industry, without due consideration. The Government has acted on a recommendation from a body with a limited coverage in the industry.

Senator Sim:

– Oh!

Senator WILKINSON:

– It is all right for honourable senators opposite to say: Oh!’ If they talked to some of the wool growers and ascertained what those wool growers thought about the situation, they would be surprised. The wool growers are not all members of the Wool Growers and

Graziers Council, which is supposed to represent 100,000 Australian wool growers but actually does not. That is the reason why the Opposition opposes the lifting of the ban. A number of us have been considering the composition of the Australian Wool Industry Conference. At this stage 1 suggest that, obviously from what I have said, there could be some very desirable reforms in the set-up. This is the kind of thing that some of us have in mind, but we are not urging it at this stage; we will have that opportunity later on.

Senator Young:

– The honourable senator is destroying the Conference.

Senator WILKINSON:

– How does Senator Young know whether it would be destroyed? We could be suggesting a scheme that would give the Conference more power and a scheme that would make it more of a statutory body than it is. The only statutory body is the Australian Wool Board. The AWIC is not a statutory body. Some of us who have given consideration to a constitution for an elected Conference have come up with an idea - it is not a final idea by any means - which I put forward for the record. Our idea is this: First, the Conference should have fifty members instead of its present fifty-six, representing electorates founded as far as possible on wool production rather than on the population of wool growers. The actual mechanics of electorate distribution should be the responsibility of the Commonwealth Electoral Office and of the Commonwealth Bureau of Census and Statistics. Second, the Conference should be elected for a term of 3 years. Third, the qualification to vote in AWIC elections should be the production of ten or more bales of wool. There is precedent for this. This is the sort of thing that we have had in previous referendums. Fourth, each wool grower thus entitled to vote should have one vote in the electorate in which he or she normally carries on business. Fifth, to qualify for election the conference candidates should derive a substantial proportion of their rural income from wool production - say, 51% - and should normally carry on business as a wool grower in the electorate Which they seek to represent. Sixth, each candidate should preferably stand as an individual and should be nominated by three wool growers entitled to vote in the electorate. Seventh, the conference members should elect from among themselves a chairman and an executive chairman to administer the affairs. Eighth, the elected chairman of the conference should be officially recognised as the leader of the industry.

Those are suggestions that J think should bear some consideration at some proper time, instead of my giving them to the Senate now. The third reason that Mr Anthony put forward was that there was no danger in relaxing the ban because it was to be only a partial relaxation anyway, that only 300 rams a year would be exported and that we would reconsider the position every year. If it did not turn out as we anticipated, we would not permit export next year. That is the way that the Government is prepared to look at the situation. 1 consider that this is a very risky sort of proposition on which to base a change to the industry so important as is being advocated by the Minister in the relaxing of the ban. I submit that the motion that we have proposed is the only reasonable way of dealing with the problem at this stage. I state it again so that honourable senators will know what we are talking about. Honourable senators opposite may ask how we would take a vote. We had no trouble taking a vote when we went about it reasonably in the case of the wool reserve price scheme, and let it not be forgotten that the wool reserve price scheme was put forward with an absolute majority - 1 think there was one dissentient - on the AWIC. But on that occasion the wool growers threw out the proposal, so the AWIC is not infallible. I suggest in all fairness to the wool industry that what we have to do is support this proposal for the good of the wool industry of Australia. I hope that on the Government side of the chamber there will be some fairminded people and some country people who will support this.

Senator Hendrickson:

– They are not country people; they are there in disguise. They are really Liberals.

Senator WILKINSON:

– No, they are country people - Country Party representatives - and I hope that they will be prepared to support this motion for the good of the wool industry of Australia.

Senator PROWSE:
Western Australia

-I am very disappointed tonight. I had hoped to hear from Senator Wilkinson some reasons for the continuation of the ban on the export of merino rams, but instead of that we have heard, for the greatest partof the honourable senator’s speech, a criticism and a condemnation of the wool growers’ organisations. I do not think we heard one utterance in defence of the continuation of the ban. In discussing this subject I propose to examine first the original action, look at the justification claimed for that action, look at the results of the action and then discuss the present situation. I have here a copy of the proclamation which was issued on 28th November 1.929. The relevant part states:

And whereas in the opinion of the GovernorGeneralthe export of stud sheep, unless the consent in writing of the Minister of State for Trade and Customs has first been obtained, would be harmful to the Commonwealth . . .

That is a quaint way of stating a proposition. The presumption is that without the consent of the Minister it would be harmful, but with the consent of the Minister it would not be harmful. So the assumption is that the export would be harmful to the Commonwealth. I read the report of the debate, which has been quoted in part. I read the alleged justification for the ban, but I am afraid that it would not convince anybody who looked at the subject with an unbiased mind that any case had been made out for the ban when it was originally applied. I am prepared to argue that at that time the . matter of possible harm to the Commonwealth was never examined in any scientific or reasoned way. I claim that the action was simply a panic reaction to a shipment of 5,000 sheep - presumably flock merinos - to Russia and of some 500 sheep to South Africa. At that time wool prices had fallen considerably from the relatively high levels of the 2 or 3 previous years. There was, admittedly, an almost hysterical outcry against the export of Australian merinos in the belief that these sheep in the country of their destination would continue to produce the sort of wool that they had produced in Australia and, secondly, that these sheep would produce progeny, which would continue to produce a similar kind of wool, and that the expansion of production of this type of wool would mean that the world wool price would decline to the detriment of the Australian producer.

This was the belief that was expressed in the debate. This sort of thinking was implicit in the speech of Mr Parker Maloney. I am prompted to quote a part of the speech which follows that which has already been quoted. He said:

At least nine-tenths of the persons with whom I have been in touch have expressed themselves in favour of some control over the export of stud sheep. A small section of those who have written to me have expressed the view that action in the direction of imposing an embargo - . . .

I ask honourable senators to listen particularly to this: a term that is not applicable to this action - . . .

The Minister at that time said that the action could not be called an embargo. Presumably he did not intend to apply an embargo. He. continued: . . ought to have been taken years ago, and that to take it now is tantamount to locking the stable door after the animal which the stable housed had escaped. It may be said that, whether it be due to climate, soil or any other cause, there appears to be a decided tendency in other countries towards the loss of type and weight in their wool product unless their flocks are replenished regularly by the infusion of fresh blood such as that which Australia has been supplying. It is considered highly probable that if those supplies are withdrawn Australia will revert in a few years to the position that it formerly occupied in the wool market.

This is a summary of the whole argument for the ban. We have learned a lot about scientific breeding and there has been some expansion of our knowledge of genetics in the intervening years, but even at that time the opinion was based on an unsound and fallacious belief.

It also expressed a wishful thought as to the economic consequences of the Australian wool industry following the ban because it assumed that the fall in prices was due to an improvement in the quantity and quality of the world’s wool. In fact the statistics which were made available at that time indicated that we had exported annually to various countries an average of 2,251 sheep of all kinds for breeding purposes. Over a 10-year period we exported 4,503 sheep to New Zealand, over 11,000 to South Africa, 2,031 to Russia and 3,284 to Japan. The Minister was trying to justify his action by claiming that the export of those sheep had been responsible for the fall in wool prices. Well, that was the flimsiest possible basis for an action of this consequence. However incorrect his wishful thinking was in regard to prices, he was scientifically absurd in his statement that unless flocks were replenished regularly by fresh blood, such as that which Australia had been supplying, they would deteriorate.

We took the action. Australia banned the export of merinos to the rest of the world. Did the wool produced in other countries deteriorate? There is no evidence that the ban effected any deterioration in the wool produced in other countries. In fact, since that time South Africa has consistently improved the quality of her wool by sound breeding methods and sound sheep husbandry. It is the only way in which any country can improve its wool once a sound genetic base has been selected. The only way in which Australians or any other people have ever been able to improve the quality not only of sheep but also of any other animal has been by the selection of animals which responded favourably to the environment in which they have been bred. The continual infusion of new blood simply destroys the genetic structure you are trying to achieve.

We did not ban the export of rams to New Zealand. We have continued to send merinos to New Zealand. Has it done anything for the New Zealand merino breed? I have seen New Zealand merinos. Most honourable senators probably have too. There are not many of them and what there are bear no resemblance to the stock from which they originated. That proves my contention that you must have sheep suitable for their environment. There is very little country in New Zealand which can successfully produce merino sheep of any kind. It is in the drier area of the south island where there is a climate approximating some part of the Tasmanian environment. We have heard a lot about Tasmanian fine wools but the latest figures available show that only 7% of Tasmanian sheep are merinos.

Senator Maunsell:

– How much of that is fine wool?

Senator PROWSE:

– Some 5% of Tasmania’s wool is superfine. Tasmania has only 315,000 of a total of 4,428,000 sheep described as merinos. Why? Because there is a limited area in Tasmania suitable for growing fine wools. The latest figures show that in Tasmania there are 795,000 Corriedales and 1,792,000 Polwarths. lt is evident to anyone who knows the business that, like horses for courses, you must fit sheep into their environment; otherwise you must choose a different breed. That is why in the very small area of the United Kingdom there is a great variety of breeds - some, thirty or more evolved in time to suit the varying climatic and soil conditions of the island. That is why the Australian merino hits been adapted to suit the varying conditions existing. That is why in Victoria only 46% of the State’s sheep are merinos, in New South Wales 71%, in South Australia 81,% in Western Australia 91% and in Queensland 97%. That is why the merino breed in Australia is not a homogeneous breed, lt varies enormously from superfine to superstrong, from strengths finer than 74s, finer than 70s and ranging in some cases much finer down to 58s.

This variation within .the breed has been brought about by the fact that in the course of time sheep breeders have found that it is profitable to match the sheep to their environment. At the time of the ban 28% of Australia’s sheep produced fine wool but today only 2.4% can be described as producers of superfine woo) and 8% or 9% as producers of fine wool.

Senator O’Byrne:

– There is more money in the bale fillers.

Senator PROWSE:

– Exactly. The farmer is a reasonably intelligent fellow and in time he finds out what is profitable and what is not profitable. Therefore we see in Australia a continual diminution in the production of the very fine wools. This is the basis of the argument accepted by the Australian Wool Industry Conference. After careful research, after examining all the evidence that could be obtained, and in consultation with the industry, it agreed that if the fine wool is to retain its position as an apparel fibre there will need to l>e throughout the world an increase in the amount of fine wool produced.’ Apparently that argument cannot be comprehended by certain members of the Opposition. They say that obviously if you increase the supply you will reduce the price. But today it is not a simple matter of supplying a certain quantity of wool of a certain class. The apparel manufacturers today have an alternative and there is virtually a ceiling on the price. If the quantity is so reduced that the mills which operate throughout the world on this quality of fibre are not getting enough to keep their mills occupied, they will switch to other fibres and the market for fine wool will disappear altogether. I believe that this argument is valid, but I am not sure that the export of Australian merinos will be in such numbers or of such quality that it will do this. There could be an increase in the amount of fine wool in limited areas., but the fact is that there are already available to breeders throughout the world plenty of fine wool merinos which can be used if they can be matched to the right environment. All the blood lines from which the Australian merino was developed are still in existence in the world and available to any breeders of any country who want to use them. We in Australia have been able to blend bloods that we got from the rest of the world. We did not produce them. We imported into Australia the sheep that produced the Australian merino. But the Australian merino is the product of the skill of the breeder. It is the product of the skill of the husbandmen in matching these things to environment. These three things have to go together, and you do not get them in this conjunction throughout the world.

I find myself in complete agreement with Dr Euan Roberts, Senior Lecturer on Sheep Breeding at the School of Wool and Pastoral Science of the University of New South Wales, who said:

The export of Australian merinos would have practically no genetic effect on overseas flocks, or on the Australian wool industry.

Dr Roberts said that when meat production was the most desired trait of fine wool sheep, as in the USA, a trend toward Australian merino type would be vigorously opposed.

Australian merino blood was not popular in the USA nor in Russia, where adequate opportunities existed for testing it under local conditions.

Continuing his reasoning in another letter to the Land Editor, Dr Roberts said: ‘South Africa, which may be the country most likely to want Australian rams for climatic reasons, will be the least likely to benefit from importations simply because South African flocks are already of a high standard and brimming over with Australian genes imported prior to 1930.

I believe that the pre-eminence of Australian merino wool rests on environmental factors. We have a good type of sheep for our conditions, and skilled feeding and care enhance their appearance.

If this situation was not valid then the Australian merinos in South Africa and South America would have been raided by other countries, who, having been convinced of their merit, would have acquired them from these countries after 1929 when Australia closed its doors.

This is the case that has been put forward by authorities in this matter - by people who are qualified to express an opinion and who have studied the case. But there has been one aspect of the Government’s action in 1929 which has been overlooked. To my knowledge, the constitutional position has never been challenged. I believe that it is established that the Commonwealth has the power to prohibit exports if it is in the interests of the Australian economy to do so. But I submit that it has a very grave responsibility in so doing to be fully assured that the action is in the interests of Australia, and in my opinion it also has a moral responsibility to see that those who are affected by the ban are not injured in the process.

This ban was imposed not by a referendum of the growers but by legislative action, and it should be lifted in the same way as it was imposed, not by any process of ballots or anything else. It was never referred to the producers in the first place and it should not now be so referred. Have the people who produce the sheep in question no rights at all? We hear a lot of people talking about the sheep belonging to the industry and we hear people who would not know the difference between a sucker and a hoggett talking about our industry.

The sheep that were affected by the ban belong to a relatively few individuals in the country. These were the people who, by their intelligence, by their perseverence and by their industry, gave to Australia her pre-eminence in the world market. What thanks did they get? In many quarters they were vilified as though they were exploiting the Austalian industry because they wanted to continue to sell their product in the world market. By the action of the Commonwealth, these people were compelled to accept a deprivation of their market. To me this is comparable to the position of a young man who obtains a patent for some process, or designs a machine which would contribute very greatly to the welfare of cur industry and to whom the Commonwealth says: ‘Yes, you have done a great job for industry. You have a patent but we want to keep your invention in Australia. Therefore, you are not allowed to export your invention or to sell the right to use your patent anywhere in the rest of the world. This point is raised by me because 1 feel very strongly that we have overlooked this aspect in imposing a ban on people who undoubtedly have done a great thing for the Australian economy.

Let us now have a look at the suggested referendum. What is the question that the Opposition proposes to put? Are we going to ask the growers to agree to a complete relaxation of the ban? Or are we going to ask them to agree to a proposal for a limited ban? There is no suggestion in the motion before the Senate as to just what sort of question we are going to submit. Then, of course, there arises the question as to who is going to be given a vote. Are the wharf labourers and transport workers to be given a vote? They show great interest and want to take a part in industrial stoppages. The concern that members of the Labor Party develop for primary industries on occasions when they think there is some opportunity to gain political advantage is wonderful but they do not hesitate to injure primary industries by holding up their products until they rot on the wharves. Is the right to vote to be given to the Corriedale breeders, the Polwarth breeders and the fat lamb breeders and to the 89% of wool growers in Tasmania who do not produce Merino wool? How are we to select those who are to vote? Or are we to ask the stud breeders, the people affected by this decision? Are we to have a referendum of those people because we are dealing with their sheep?

The Labor Party has decided to support the ban on the export of merinos, lt is doing this because of political expediency and for no other ground. In so doing it has found it necessary to revive the 40- year old myths and superstitions regarding the merino breed. It is fomenting the sentimentalism and near hysteria that this question has evoked in certain quarters and has chosen to ignore any study made of this problem in recent years. It has thrown considerations of truth and justice out of the window in the interest of possible political advantage. The proposal before the Senate that we express an opinion tonight on this matter is one of the most ludicrous questions that we have considered for some time. We have heard nothing whatever to justify continuation of the export ban.

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– I am afraid that 1 have no prepared speech on this subject and I bring no scientific data to bear on the problem. I do regent the suggestion that because one brings a motion forward in this chamber it is for political advantage.

Senator Prowse:

– What else?

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– 1 say that is not so because in this instance 1 do not know in which way one would vote if one wanted political advantage. I received a long letter from a very good friend in New South Wales who told me that I should support the embargo on the export of merinos. I also have another friend in New South Wales who has a most famous stud and she says that we should lift the embargo. I am not sure how one would get political advantage.

Senator Prowse:

– What do the Tasmanians think?

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– That is what I am coming to. If we come back to the question of whether we are supposed to represent a State in this Parliament then every Tasmanian senator must vote for the lifting of the embargo. I think every organisation in Tasmania has supported the lifting of the embargo. Not one organisation that has written to me has requested the retention of the embargo. What the year 1929 has to do with this matter I am not too sure but every speaker has mention it so 1 have done so also and I will pass on from there. I do not want to make a pun but when I read the arguments put forward by both sides then I cannot help but say that they are pretty woolly. One could shoot holes in both arguments without any trouble. The question boils down to this: What is the best for one’s State? The best thing for the people of Tasmania is that the embargo be lifted. Senator Poyser asked, by way of interjection, who was to vote in the proposed referendum. This is a key question when considering this matter. Senator Poyser said that the Australian

Wool Industry Conference should decide this issue. That is the impression I got although he had previously been castigating the Conference. I wondered how he correlated his two submissions. If the Conference is not to decide this question, who is to vote on it?

Senator Murphy:

– The Parliament will decide.

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– If Parliament is to decide this issue then let us consider whether we should have a referendum. This is what I want to get to. If Parliament is to vote on this motion as amended then we may as well vote straight out for the embargo but if we go for a referendum then we will get & ‘no’ vote without considering the fact that from all referendums we get a ‘no’ vote.

Senator Little:

– They ought to know this after the lesson we gave them last year.

Senator TURNBULL:
TASMANIA · IND; AP from Aug. 1969; IND from Jan. 1970

– That is right. We did very well. On this occasion, unless we clearly define who is to vote, then obviously the people who breed Polwarths, Leicesters. or whatever the sheep may be, will vo!e ‘no’ because’ this is not in their interests anyway. They probably would nol be interested because they are allowed to export their rams. If we say that the vote should he given only ‘to those who breed merinos then a referendum would be a waste of time because those people obviously would vote ‘yes’. If tonight we vote in favour of a referendum we are saying that we support an embargo. I think we should cut out the expense of a referendum and ask straight out: ‘Do you or do you not believe in an embargo?’ I do not know enough about this matter but having listened lo the arguments from both sides of the chamber I must say that as Tasmanians want the embargo lifted I must oppose this motion.

Senator SIM:
Western Australia

– I did hear some honourable senator issue a challenge for some wool growers on this side of the chamber to express an opinion. To my knowledge everyone on this side of the chamber who has spoken has been a wool grower. In many cases they are men who have spent most of their lives in the wool industry. Their interests are in that industry. Senator Poyser said that the lifting of the embargo was not in the best interests of Australia and presumably not in the best interests of the wool industry. Of course we who speak for the industry and represent it must stand and express our opinions. I state here and now that I strongly support the lifting of the embargo on the export of merinos.

This is not a view that I have arrived at suddenly. All my adult life 1 have believed that the embargo should never have been imposed because it was never in the interests of the wool industry. Senator Prowse raised this matter and made the point very effectively. The embargo was introduced in 1.929 as a panic measure at a time of depressed prices. The reason for the ban was the export of some thousands of sheep to Soviet Russia. There was a reason for those exports. Before we go any further wc should understand that the conditions of 1929 no longer exist. In fact, they did not continue for many years after 1929. Russia had quite substantial Merino flocks but they had been decimated by the First World War, the civil war and famine. In 1914, according to my reading, Russia had between fourteen million and fifteen million Merinos. By 1923 the number had been reduced to 363,000. Therefore there was a strong desire by the Russians to try to replace the Merino flocks rapidly. It was quite natural that they would seek Merinos from the country which had them and which was best equipped to sell them. That was the situation at that time and I repeat that that situation no longer exists.

There is no doubt in the mind of anybody who studies wool thai the world is short of wool of an acceptable standard. I am referring now to the medium and fine wools, lt is in our interests to see that the world has an ample supply of those wools. I do not want to get mixed up with the crazy economics of Senator Wilkinson but he said something to the effect that he believed that in the private enterprise system if you increased production prices would come down. The situation we face today is that the world is short of these types of wool and if we do not supply them then the manufacturers will turn to other fibres. That is undeniable. If we want to seek authority for it, we have the International Wool Secretariat. Senator

Wilkinson spent most of his time denigrating the Australian Wool1 Industry Conference, the Australian Wool Board and the International Wool Secretariat. I do not know whether he, Senator Poyser and the other members of the Labor Party hold themselves up as being greater authorities on the world market for wool than is the International Wool Secretariat. But, for my part, I accept it as the authority. It is in daily contact with world trends, lt points out:

The total market for wool and wool type fibres is expanding much more rapidly than the rate of increase in world wool production. Concent is felt that this trend may continue and force wool to become a minor raw material no longer able to influence the stability of the wool textile industry.

Those are fairly strong words.

Senator Little:

– - This trend occurred in silk, did it not?

Senator SIM:

– Yes.

Senator Little:

– And, to a degree, in leather.

Senator SIM:

– It happens in every fibre that is in short supply. When world needs are not being met the manufacturers turn to other fibres. It has been stated that 20 years ago wool enjoyed, I think, 13.5% of the world’s fibre market. Today wool’s share has fallen to just on 8%. It is suggested that, if this fall continues and if world wool production does not increase, by the end of this century wool’s share will be but 4% of the world’s fibre market. This will not mean that the textile industry will remain short. The textile industry will turn more and more to the synthetic fibres and wool will become a minor fibre in the textile industry of the world.

Mr Street, himself a wool grower, visited Japan recently. I was struck by the comments he made when he spoke in the other place after discussions with representatives of the Japanese wool textile industry. As reported at page 935 of Hansard, Mr Street said:

Several of the largest users of wool in Japan have told me that they consider the lack of adequate supplies of good wool-

That is the type of wool to which we are referring; the 58s and above -

  1. . to be by far the greatest danger to the wool industry. If sufficient wool of the required quality were not available, the textile industry would inevitably turn to synthetics to fill the gap. Once a section of the market were lost to wool it would be extremely difficult to recapture it.

That is the view of the Japanese wool textile industry. If we in this Parliament are to ignore the warnings of the International Wool Secretariat and the Japanese wool textile industry - our largest market - we must be living in a fool’s paradise.

I suggest that the fear expressed by the Opposition, namely, that by selling 300 rams per annum overseas we would create an oversupply of medium and fine quality wool on the world market is disproved on every count. Members of the Opposition have brought forward no evidence to sustain their argument, except to say that it would be a real gamble or it would be risky to do this. On what do they base the view that it would be risky? They do not base it on the view of any world authority. Apparently they base it on prejudice or some other reason; perhaps, although I hate to say it, on ignorance.

Let me go further and speak much along the lines on which Senator Prowse spoke. We have to understand that the various types of Australian merino have been adapted to suit the Australian environment. 1 do not know how many different types of merinos and different qualities of wool - from 58s to 74s. 80s and even above - we have. Every one of these types has been adapted by the skill of our stud breeders to suit the particular environment in Australia. While merinos are most adaptable sheep, it would be many years before they could adapt themselves to the environments of other countries. So, even if the argument put forward by the Opposition had any validity - of course, it has none - there still would be no danger to the Australian wool industry.

Senator Ormonde:

– Then what are you worrying about?

Senator SIM:

– I am not worrying about it at all. In fact, I am very happy that the embargo has been lifted. Members of the Opposition are the people who are worrying; not me.

Senator Dittmer:

– How long do you think it will be before the rams will be useful to other countries?

Senator SIM:

– I would hazard the guess - it is only a guess - that it would be at least 10 years before they would be of real use. As Senator Prowse so correctly pointed out, there are spread throughout the world types of merinos that have been adapted to the environments of their own countries. There is no shortage of the original merino blood in the world. It exists and is readily available in Europe, South Africa, South America, the United States and Soviet Russia. Of course, it still exists in Spain. So the blood is available almost throughout the world. Therefore, by imposing an embargo we are not preventing any country from using the merino type sheep, if it so desires.

In India I have seen the American rambouillet and the Russian merino. These are sheep bred for the environment of their own country. They produce very good quality wool - 60s or perhaps 64s. It is noi as soft handling as our wool, but it is of good quality. This is a type of wool that we want in the world. When Senator O’Byrne was talking about cotton he could not resist the temptation to say a word or two about wool. He referred to the cheap labour countries swamping the wool market to the detriment of Australia. I would imagine that South Africa cannot produce any more fine wool than it is producing today.

Senator O’Byrne:

– Unless it can get our rams. The quality of its wool is equal to ours.

Senator SIM:

– I have heard some remarkable arguments. All I want to say to Senator O’Byrne is that all that could happen would be that Australian rams could, over a number of years, improve the quality and perhaps the weight of South African merino wool. They could do no more. They could not make available more land on which to run merinos. They could only improve the quality and weight of the wool Fears have been expressed abou! Soviet Russia. At the moment it has about 133 million sheep and goats. The total number of merino sheep is about 50 million. Despite that, Russia imports sufficient wool to provide about 2.4 lb of wool per head per annum for its population. For Norway the figure is 4.4 lb; for West Germany, 4.8 lb; and for Austria 5.8 lb. With improving standards of living in Russia, if the trend in other countries occurs there too - one cannot believe that the trend could be otherwise, particularly in a cold country - all that Russia could do with an expanding merino population would be to provide more wool for home consumption. It would provide no threat to Australia on the world market. I do not believe that any such threat exists, but 1 am using the Labor Party’s argument. India and Pakistan have been anxious for some years to import Australian merino sheep to cross breed with their own sheep in order to improve the quality of their wools. They would provide no threat to the Australian industry. I would have thought that members of the Australian Labor Party who are interested in improving the economic welfare of those countries would be only too happy to see countries like India and Pakistan improve the quality of their wools. 1 have dealt with some of the arguments which have been advanced in support of the retention of the embargo. 1 suggest that not one of them has any validity. It has been suggested that the price of rams obtained by Australian wool growers will increase. About 350,000 rams are produced in Australia each year. Three hundred rams represent less than one in a thousand of the total annual production. I understand that Australian wool growers do not buy stud rams. They buy flock rams. I cannot imagine that any country which is interested in importing Australian merino rams would import anything other than high class stud rams, because of transport costs and other reasons.

Senator McKellar pointed out that in 1967 ; the latest year for which I have figures ; about 202,000 flock rams were sold and about 290,000 were unsold. So surely the export of a few rams will not have any effect whatever on the prices of flock rams available to Australian wool growers. The fact is that it will have no effect whatever on Australian wool growers. Over the years many powerful arguments have been advanced for the lifting of the embargo. It has been mentioned that the late Sir Ian Clunies-Ross and scientists of the Commonwealth Scientific and Industrial Research Organisation in 1951 recommended the lifting of the embargo. In 1962 the Australian Agricultural Council made a similar recommendation. It is not a new argument. It has been advanced for many years. I am delighted to find that the majority of wool growers organisations have at last come around to supporting or recommending the lifting of the embargo.

I do not wish to follow the tortuous arguments of Senator Wilkinson relating to the Australian Wool Industry Council and the Australian Wool Board. He referred to a reorganisation of the Australian Wool Board or the AWIC. I could not understand his argument and, quite frankly, I doubt that he understood it himself. The AWIC was established to advise the Government on behalf of wool growers. It represents woo) growing organisations in Australia, lt might not be perfect. I do not know. But the Australian Labor Party is not perfect either. Someone might suggest that a reorganisation of the Labor Party would make it nearer perfect. The point is that the AWIC was set up by the industry to advise the Government and it has made its recommendation. I do not believe that the Government had any alternative but to accept that recommendation.

My colleague Senator Prowse dealt very effectively with the suggestion of a referendum. Hansard of 1929 shows that the embargo was not imposed by legislative action, lt was done by proclamation. It was never debated in the Parliament. The Minister issued a proclamation under the Customs Act. No referendum was held then and I do not understand why there is a sudden rush of blood in support of a referendum now.

Senator Little:

– In those days members of the Labor Party were not experts at wool gathering as they are now.

Senator SIM:

– They have been wool gathering for a long time since. I could go on at some length to bring forward arguments in support of the lifting of the embargo. I believe that the sale of some merino rams from our studs to overseas buyers will act as a stimulus to the Australian stud industry, to the skill and adaptability of which we have a great deal to be thankful for. Honourable senators opposite have referred to our heritage of merino rams. This might be good Socialist philosophy, but the fact is that it is a heritage of those whose money and brains went into developing merino wool growing in Australia.

Senator Hendrickson:

– And the sweat of the workers.

Senator SIM:

– 1 have heard many arguments, and now there is another one about the sweat of the workers. The plain fact is that wool production in the world is falling behind the world increase in population. The only way in which the wool industry can retain its position as a producer of prestige fibres is to improve the demand for its product. If it cannot meet the demand it will decline and wool will become a minor fibre. I suggest that this development would not be in the interests of Australia. So I have great pleasure in supporting the lifting of the embargo.

Senator Hendrickson:

– You are joking.

Senator SIM:

– I have never been so serious in my life. I do not know how many sheep Senator Hendrickson has grown in his lifetime or what interests he has in the wool industry. 1 suggest he has none. Some of us on this side of the chamber have an interest in the wool industry and have held it throughout our lives. We speak as people whose interests and love are for the wool growing industry and not as those who know nothing about it but who try, for some reason, to jump on the band wagon. The arguments I have heard from honourable senators opposite have been pitiful. If the Labor Party wishes to convince anyone that there is validity in the arguments put forward by its members, somebody on its side had better do a little more thinking.

Senator O’BYRNE:
Tasmania

- Senator Sim has taken quite a considerable time to make a very insignificant contribution to this debate, lt appears as though the Government is deliberately seeking to talk this matter out without its supporters having the courage to stand up and have their heads counted. A number of my colleagues are in the Senate gallery tonight. Many colleagues of honourable senators opposite are also there tonight. They are very interested in the outcome of this debate. The eyes of Australia are on the Senate tonight because this is a matter of extreme importance to a very big proportion of the community who are dependent on the production of merino wool in Australia for their livelihood. I do not know whether Senator Sim is a grower of merino wool. If he is, I cannot understand why he wants merino rams exported from this country. I wish to quote from the Year Book of South Africa for 1968. It states:

Wool is the biggest agricultural export commodity and, after gold and uranium the biggest single item on the list of South African exports. Wool exports amount to about 25% of animal, agricultural and pastoral products and foodstuffs exports and to nearly 13% of the total value of South African produce exported. Australia exports more merino wool than South Africa but only about 76% of the total Australian wool clip consists of merino wool, compared with 83% in South Africa. Furthermore, the South African product is of exceptionally high quality.

The South Africans are seeking quantity. It. seems that Senator Sim is a merino wool breeder who wants to export merino rams to South Africa to help that country to outprice him on the world’s markets. He could not compete with South African labour costs. Honourable senators opposite know that there is a dictatorship in South Africa and that the labour conditions are such that South Africa can produce wool at a price which will have a marked effect on the Australian market.

Senator Sim:

– Prove it.

Senator O’BYRNE:

– If the honourable senator thinks of a combination of bulk with the quality that South Africa can quite rightly claim to produce he will understand my point. The Government will have to bear the consequences of this.

Senator Prowse:

– The position will deteriorate if we allow the ban to continue.

Senator O’BYRNE:

– If my good friend Jack will bear with me for a moment-

Senator Sim:

– I rise on a point of order, Mr Acting Deputy President. Can Senator O’Byrne refer to another honourable senator as ‘Jack’?

The ACTING DEPUTY PRESIDENT (Senator Wood) - Order! Honourable senators should bc addressed as such.

Senator O’BYRNE:

– Over a period of 40 years there has been a remarkable improvement in the quantity and in many respects the quality of the Australian wool clip. During that period, of course, there was 10 years of depression in which the world could not afford to buy super fine wool because of circumstances beyond its control. After that period of 10 years there was a war and the aftermath of that war - from 1939 to 1949- when the bulk of the wool required was for Army requirements. In that period of time the fine wool breeder found that with his lighter clip he could not really compete with the medium quality wool, and as a result many of the fine wool studs went cut of existence. Nevertheless there is a very good market for Australian fine wool. The Italians practically have an exclusive monopoly over . the purchase of the superfine wools that are grown in New South Wales around Yass, down in the western district of Victoria and in Tasmania. One Italian company, Zegna, pays fantastic prices, even 500d or 600d per lb. for these wools.

Senator Prowse:

– For two bales for advertising purposes.

Senator O’BYRNE:

– That may be the honourable senator’s argument. This company buys good quality fine wool and makes suits for gentlemen out of it. I do not suppose that the honourable senator has ever had one. These suits are very expensive. This is a very important market. However, T will get on to the matter that Senator Sim stressed - the worldwide demand for wool. The Opposition’s argument is that it would be much better for Australia not to export our best merino strains but to keep them and expand our own production of good merino wool in order to meet the present worldwide shortage of wool. We can sell all the wool we can produce.

Senator Sim:

– And the world market can absorb it.

Senator O’BYRNE:

– The world market can absorb it, that is true. The point is that there are land development schemes in Western Australia and South Australia to meet the challenge of increased demand. The proposal is to send 300 merino rams overseas in the first year. I think that the Minister for Repatriation (Senator McKellar) said that there are 1,800 studs in Australia. So the 300 rams are to be supplied by the 1,800 studs. There is certain to be some very keen competition by the studs to supply these rams. The argument has been put that the world demand for textile fibres is expanding and that the export of 300 merino rams will result in a large increase in the supply of wool on the world market which will meet the competition from other fibres. According to Senator Sim the price of Australian wool will not be affected because South Africa will not be able to produce wool cheaper. Most of the Government’s arguments about the lifting of the embargo are contradictory. That is why the growers want the opinion of the industry on the proposal. The growers are the ones who have to keep our wool export industry going. The stud men are playing an important part in that they are keeping the continuity of the breed going and are supplying the Australian grazier and woolgrower with Hock rams. They are doing a mighty job and have done so over the years. The fathers and in some instances grandfathers of the people who are in the wool game at present were the ones who were able to. bring the Vermonts. the Saxons and the Rambouillet together tei make the Australian genetic strain. Honourable senators opposite overlook the fact that Carter experimented in England and was able to breed superfine merinos. Noone can dispute that. The Opposition believes that the importing of Australian rams by overseas countries will result in an increase in the world supply of merino wool which in turn will depress the price of our wool.

Senator Sim:

– What basis does the honourable senator have for that statement?

Senator O’BYRNE:

– The more there is of a commodity on the market the more will be the selling competition. This will be to the detriment of the Australian industry. Wool from any other country will undersell ours because of the inflation in this country. Inflation is costing us out of the world market in every commodity. Even the Minister for Primary Industry (Mr Anthony) has said that we must watch inflation very closely and that we must do someting about the problem. Yet the Government expects our graziers and wool growers to be able to compete with cheap labour overseas. I believe that the Government is letting the industry clown badly. There are many things that the Opposition would like to bring forward during this debate but we will insist upon a vote being taken on this resolution tonight. If necessary we will oppose the motion for the adjournment of the House. I believe that the people in the industry are entitled to two things: Firstly, they are entitled to a decision by the Parliament on the matter and secondly, they are entitled to an opportunity to participate in their own affairs. After all, it has been pointed out tonight, and it is enlightening to many people, that the Australian Wool Industry Conference and many similar bodies seem to be self-created and selfproliferating. When one comes down to tintacks one can hardly get to the source of some of these bodies. Senator Wilkinson illustrated that point very well.

The Opposition believes that competition from overseas purchasers could increase the price of high class rams to the Australian buyers. I am given to understand that at present there are between 28 and 30 South African buyers in Australia and that they have chartered an aircraft to take them to the studs where they can choose the best 300 rams. Do honourable senators opposite suggest that these buyers would come to Australia and visit the studs if only 300 rams were available to them? On the other hand, will not the competition that they will infuse into the sale of rams make it more difficult for the Australian buyer? Do honourable senators opposite think that these visiting buyers will pay peanuts for some of the magnificent specimens of merino rams that they have been unable to purchase for 40 years? Forty years of breeding, husbandry and all the other things that are spoken of has gone into the evolution and the development of our merino rams. The Government will sell out the wool growers for a mess of pottage. For thirty pieces of silver it will betray the great industry that has been built up by generations of stud breeders - the industry on which Australia still depends so much.

Senator Webster:

– Will the honourable senator tell us to whom in the wool industry he will give the vote?

Senator O’BYRNE:

– I would like to give the vole to everyone associated with the production of merino wool in Australia. The terms of our resolution, as Senator Wilkinson stated, refer to a ten bale ratio.

Senator Webster:

– Ten bales of what?

Senator O’BYRNE:

– Why not one fibre? Generally the Australian wool industry is facing the most serious crisis in its history. The crisis can be adverted only if we, responsible members of this Parliament, accept our responsibility to try to help the industry resolve its major problems. The wool industry is perilously close to an economic crisis caused by this very cost price squeeze, lt does not matter how much honourable senators opposite snigger and try to pull the wool over other people’s eyes, they cannot escape the fact that the wool industry has become one of the worst fields of investment in this nation. The return that the grower gets from his investment in his property is down as low as 1% or % if he is lucky enough to be outside the drought area. Other people can invest in oil companies and in the mineral industries and other profitable business ventures, but the grazier cannot share in that wealth. He has to ask his bank manager for a loan to erect some extra fencing or to buy a new car. He cannot invest in the same way that other people do. His return on his initial investment is very poor indeed. It will get worse because of the increasing cost factor all the time that this inflation is continuing.

The industry is facing this crisis. It has r great opportunity to expand its production and to improve its product. Do honourable senators opposite believe that the Australian grazier can meet the challenge if the Government gives his opponents in other countries, whose economy has inflated less or whose cost of labour and other production costs are lower, the opportunity to import stud rams? How does the Government intend to help the Australian grazier meet this great challenge? I believe that we will be doing a grave disservice to the Australian merino wool growers if we open up the gates and allow our merino rams to be exported. After all, the initial 300 is only a start and an opening of the flood gates. We are debating the principle. As has been pointed out, the 300 that will be exported could, with the use of artificial insemination, produce 1 million lambs in other countries.

The Minister said that the Government would impose tight restrictions and would not allow the export of merino ewes. Honourable senators opposite have argued that the lifting of the ban will not affect the Australian industry. Why not allow ewes to be exported, why not allow semen to be exported and why not open the gates if it will not do any harm? For 40 years Australia has been opposed to the lifting of the ban. Honourable senators opposite speak with their tongues in their cheeks when they say that no-one should support the total lifting of the ban. 1 know that the Minister’s proposition is for a partial lifting of the ban, and I know of the restrictions that supposedly have been imposed by the Minister. I hope that a vote will be taken very soon. We must not close our eyes to the challenge that is facing the merino wool grower in this country today. We must help him in this critical time and give him every protection that is possible so that his product can compete on the world market and get his full share of this allegedly diminishing proportion of the world market. 1 say ‘allegedly’ because the demand for high grade wool is growing. Although the demand for ali fibres is growing, although the gap between wool and the synthetic fibres is growing wider, there is a great market which Australia should chase after, obtain and supply. We have this exclusive merino wool that the world envies. We should make the best of it by expanding our production and helping the merino wool grower to make this country continue to be what he made it in the past. We have been on the sheep’s back for the last 120 years. The wool1 grower has done Australia proud. I do not think we should let him down at this hour.

Senator BULL:
New South Wales

– I have listened to tonight’s debate with considerable interest because I have been interested in this issue for a considerable time. I admit - and I will admit this to the Opposition - that the issue is a controversial one and not one on which one could say that a certain course is definitely right or definitely wrong. I believe that the issue has stirred emotions not only in this chamber but throughout those parts of Australia where people are interested in the very important wool industry. From time to time one is called on to make a judgment. We are called on to make a judgment on what I believe is a very important issue of interest to the Australian primary producers and to the wool industry and an issue which is of great economic importance to the Government. Therefore I think that we should try to study the issue, examine what has been done and contemplate the recommendations that are before this House and that are available to every honourable senator. Then we should come to a studied and proper judgment on the issue.

During the past 10 years I have been closely associated with various organisations in the industry. I have been in favour of an easing of the ban. I have found no reason to change my ideas on this subject. During the last week or two I have looked back into the history of this matter and studied the matters that led up to the Government making a recommendation to lift the ban. As a consequence of its recommendation we have this debate in the House tonight. A few years ago the previous Minister for Primary Industry, Mr Adermann, said to me that the Government would not act in any way to ease or to lift the embargo unless the industry required it. That is the situation in which we find ourselves today.

I now deal with the sequence of events that led up to the recommendation which asks for a decision by the Government and on which the Government has decided to act. I know that for a great number of years the wool industry organisations have been divided fairly evenly on the issue. At the 1963 Australian Agricultural Council meeting the matter came up for discussion. I think I am correct in saying that it was referred to the Standing Committee on Agriculture, which gave it consideration and referred it to the Australian Wool Industry Conference. I will have much more to say about the Australian Wool Industry Conference later, but not at this stage. In turn the Australian Wool Industry Conference, properly and wisely, referred the matter to the Australian Wool Board which is in a position to make a recommendation on such a vital question as this. If one reads the material which has been supplied to all honourable senators one will see that the Australian Wool Board studied the matter fairly and squarely and examined the pros and cons of the lifting or the retention of the embargo, and came out in favour of the easing of the ban. But it went further than that. It was not prepared to leave it to the Wool Board alone but referred it to the International Wool Secretariat.

In my opinion that organisation is doing a magnificent job. It has close contact with the consumer throughout the world and is looking at all aspects of the wool industry - not only the wool growing section of it. It is just as important that it look to the manufacturing and the demand side of the product which we grow in Australia as to consider other aspects of wool. But in conjunction with all this the International Wool Secretariat has looked at the general question of the textile industry. I think it is fair to say that there is no similar organisation in the world today, bearing in mind its close association with the International Wool Textile Organisation and its agencies throughout the world. We cannot ignore the findings of the International Wool Sec, e.tariat. Honourable senators will be aware that the Secretariat has supported the easing of the ban.

Senator Little:

– It is hardly an international organisation, lt is not a United Nations organisation.

Senator BULL:

– The honourable senator has something there. We have invited other countries to join the organisation but so far we have not been able to achieve anything in this direction. It must be remembered that with us on the Internationa] Wool Secretariat are two other countries which produce a considerable amount of merino wool. The Secretariat considered that it was not likely that harm would result if we allowed the ram genes to go to other countries. The genetic argument was put very ably by Senator Prowse tonight. It is an argument which has been supported by able men who I feel are qualified to speak on the subject. I refer to men like Dr Graham Edgar, former Director-General of the Department of Agriculture in New South Wales, a prominent veterinarian in his own right and a former director of the Glenfield Research Station which is connected with the Department of Agriculture. He has come out strongly to say that in his opinion no damage is likely from the further exportation of merino genes from Australia. As has been mentioned by Senator Prowse, the argument has been supported also by Dr Euan Roberts. 1 shall not deal further with this point because Senator Prowse referred to it tonight

It does not surprise me that these prominent men came to this conclusion. We have to remember that prior to 1930 the export of our rams to other countries was more or less unrestricted. This is evidenced from the figures which appear in table 2.2.3 of the Australian Wool Board’s White Paper on the Embargo on the Export of Merino Sheep. With the concurrence of honourable senators I incorporate the table in Hansard.

The table shows that prior to the imposition of the ban we exported a great number of rams from Australia, including, in the 10 years prior to the imposition of the ban, more than 11,000 to South Africa, 4,000 to New Zealand and 2,000 to Russia. 1 direct the attention of all honourable senators to the note which appears at the bottom of the table. It will be seen not only that some of our best rams left Australia during this period but also that breeders from other countries, such as South Africa, Russia and New Zealand, had access to the very best of our rams. Breeders from other countries could go to any breeder in Australia and, if they had the money, could do a deal with him for the purchase of what might have been his top stud ram. Although at that time the very best rams could be supplied, the recommendation now before the Government suggests that they be sold at a recognised auction sale which has been arranged by the Sheep Breeders Association. I cannot imagine any recognised sheep breeder offering his best rams for sale to the rest of the world. Getting back to the arguments raised by Dr Graham Edgar and Dr Euan Roberts, the best genes have already left Australia. The importers of those sheep have had equal opportunity with Australians to improve their studs in other parts of the world. Why have they not done so? It is because, unfortunately for them, they have not the situation environment that we have in Australia to produce wool. This is one of the main reasons why I support the easing of rheban.

I come now to the sequence of events leading up to this matter coming before the Australian Wool Industry Conference, lt will be realised by the Senate that this subject has been examined by competent people and competent organisations in Australia and overseas. They are people who are knowledgeable about the industry. Having received reports from these organisations the Wool Industry Conference decided that it should examine the issue and make a determination on it However, because of circumstances, it remained on the agenda for 12 months. I am not aware that anybody expressed an opinion against the easing of the ban or lifting of the ban - as it was expressed on the agenda paper - during that 12 months. It was because of marketing issues that it remained on the agenda paper for such a considerable time. After consideration by the various affiliated State organisations, after consideration by the federal organisations, including the Australian Wool Growers and Graziers Council, the Australian Meat Producers Federation and the Australian Primary Producers Union, the Conference considered the matter about last October, at which time there was a vote of 38 to 15 in favour of easing or lifting the ban. If any honourable senator opposite suggests that the subject was not given proper consideration, I would like to know what is considered to be proper consideration. Here was a responsible body looking at the matter, getting the best advice possible and making a determination on a very important issue.

Senator Gair:

– Many of their members are very poorly informed on it.

Senator BULL:

– Is the honourable senator referring to members of the AWIC?

Senator Gair:

– Yes.

Senator BULL:

– If so, I am sorry to hear it because they have had the opportunity to become informed. Every member would have received this White Paper. Every member of the AWIC would have received the reports from the Commonwealth Scientific and Industrial Research Organisation. After giving proper consideration to the matter it is their own fault if they are not well informed and they must face up to that responsibility.

Senator Gair:

– Organisationally the industry is in a very poor state. That is one thing that I have learned as a result of this controversy.

Senator BULL:

– In some respects I might agree with the honourable senator, but I shall come to it a little later. The position in which we find ourselves today is that we have before us a determination of the Government to ease the ban, but with what I believe are adequate safeguards. These have been mentioned tonight and I think there is no need for me to mention them again. I believe that we should look at both sides of this question as ably as we can and then come to a determination. I have tried in my remarks to refer to the arguments against the easing of the ban. As was said here tonight, one argument against it is the fear of overproduction of merino wool.

Debate interrupted.

page 971

ADJOURNMENT

The PRESIDENT (Senator the Hon. Sir Alister McMullin - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question:

That the Senate do now adjourn.

The Senate divided. (The President - Senator Sir Alister McMullin)

AYES: 27

NOES: 22

Majority . . . . 5

AYES

NOES

Question so resolved in the affirmative.

Senate adjourned at 10.35 p.m.

Cite as: Australia, Senate, Debates, 22 April 1969, viewed 22 October 2017, <http://historichansard.net/senate/1969/19690422_senate_26_s40/>.

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